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Cotton price cut by Rs25
The selling pressure compelled the Karachi Cotton
Association (KCA)- the regulatory body of the
cotton trade, to slash down the spot rate by Rs25
per maund, after a short interval which made the
millers unhappy as they had pledged a large number
of bales with the banks.
"By virtue of high volatility in domestic market
coupled with depressed international market
commercial exporters are very cautious and avoid
panic buying", a cotton exporter said.
Approximately, 60 per cent stock in backlog with
the ginning factories is of low and medium grade.
Whereas, the demand and price for superior grade
is steady, both at the international and the
domestic markets, another exporter said.
"It may be little bit difficult for ginners to
hold prices in the backdrop of bearish price
outlook at international market, and in absence of
genuine buyers, they may prompt selling from the
weak-holders and the consequent decline in
prices", a ginner said.
New York cotton futures on Wednesday fell by 1.39
cents per lb for ruling May and 1.28 cents forward
July settlements at 57.37 and 59.41 cents,
respectively.
"We are weighing the price differential between
the local and foreign stuff before resuming fresh
buying," spinners say.
"If world prices fall further we will make fresh
forward covering purchases."
The falling trend in the international market may
add to the burden of the ginners who are already
in hot waters in the absence of the buyers.
The current steep fall in New York cotton futures
on speculative selling could make the local
spinners more competitive on th1e export front if
prices fall further.
The official spot rates lowered in line with the
world prices’ by Rs25 from Rs2, 850 to 2,825 per
maund.
According to the daily market report on ready
offtake, around 3,800 bales were transacted at the
rate below the spot rate fixed by the KCA.
Around 600 bales from Salephat, and 400 from Rohri
changed hands at Rs2, 600 inclusive of sales tax.
Besides, 400 bales from Sakrand and 800 from
Sadiqabad were sold at Rs2, 400 per maund.
The News International, Pakistan |
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Pakissan.com; Advisory Point
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