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Business improves in cotton market
KARACHI, April 28: The
cotton market showed a slight improvement in
business deals on Tuesday, despite a negative
trend in New York futures amid no change in local
spot rate for base grade three cotton.
Ginners were happy with the trend in the local
market as more than 10,000 bales changed hands
before the closure of the season which was only
three days away, sources said.
The ginners were anticipating a rise in prices as
May futures in the New York market increased by
0.23 cent per lb on April 26. But, July futures
went down by 1.63 cents per lb.
The negative trend on the New York futures would
not have much impact on the local market because
of heavy demand here, a broker claimed.
A spinner said that at least 800,000 bales, out of
remaining stock of 1,000,000 bales with the
ginners till April 15, were of low quality while
only 200,000 bales were prime quality cotton.
"This will lead to a fall in prices in the coming
days," he predicted.
Though spot rates for base grade three cotton
stood unchanged on Tuesday, some lots of good
quality cotton were sold above spot prices.
Ready offtake stood at 10,300 bales on Tuesday.
Among them, highest rate of Rs3,025 was given for
200 bales of Kabirwala (Punjab) and same quantity
of Kachku (Punjab). Besides, 2,000 bales Burewala
were sold at Rs3,000 to Rs3,025, 500 bales
Ahmedpur at Rs3,000, 200 bales Daharki and 800
bales Liaquatpur at Rs2,900, 1,400 bales Sehja (Khanpur)
at Rs2,950, 1,000 bales each from Gocheri and
Nawabshah at Rs2,850, 2,000 bales Haroonabad at
Rs2,700 and Rs2,750, 400 bales low quality lint
from Salehpat at Rs2,625, 200 bales Jam Sahib Goth
at Rs2,690 and 400 bales Gojra at Rs2,100.
A broker said if each and every bale was utilised
properly, the country would need to import 15 lakh
bales to meet requirements. "Almost 13 lakh bales
have so far been imported from various countries."
On the other hand, the country has recorded export
registration of 177,711 bales of 2002, 2003 and
2004 crops till April 5, while shipment of 157,694
bales had completed till early March.
The New York cotton futures on Monday recorded
generally a negative trend. Only May futures
increased to 64.18 cents from 63.95 cents per lb,
while July futures decreased to 62.17 cents from
63.53 cents per lb.
Spot rate in the local market remained unchanged
at Rs2,850 per maund (37.324 kg), excluding sales
tax. When 15 per cent sales tax and Rs50 per maund
up-country charges are included the price comes to
Rs3,327.50.
Despite improvement in business on Tuesday, some
market players forecast a negative trend in prices
that would remain until the new crop arrived
somewhere at the end of July.
The News International, Pakistan
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Pakissan.com; Advisory Point
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