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Easy buying trend on cotton market
KARACHI, April 4: Cotton market finished the
weekend session on an easy note as spinners were
again conspicuous by their absence apparently
hoping further decline in prices.
"The market is now the victim of falling mill
demand rather than any other destabilizing
factor," brokers said, adding "both sellers and
buyers allowed the standoff to continue."
All eyes now seem to be focused on the arrival
phutti figures for the fortnight ended on April
l1, which are expected to set the future market
direction.
According to unofficial reports, the total
arrivals could touch the high mark of 9.8m bales
on April 1, and the final figure up to May 1,
would be slightly above the 10m-bale mark, leaving
a supply gap of about 2.5m bales, to be made up
through imports.
Already, spinners and mills had in their godowns
about 0.7m bales of the imported stuff and some
more consignments are claimed to well on their way
and expected to reach here within the next couple
of weeks.
The recent decline in world prices has put the
local spinners at a disadvantage as some of them
had made forward deals for a substantial quantity
at an average c.i.f price of 65 cents per lb,
market sources said.
"Some of the spinners and mills have settled their
forward deals signed with the foreign sellers at
higher rates after the current steep fall after
having paid the price differentials," they said.
Mills and spinners are now eyeing the local stuff
being offered at much lower rates in the backdrop
of limit-losses in the New York cotton futures
more than twice during the current week.
They said local prices, which had dropped to below
Rs3,000 per for fine lots and Rs2,400 to low-mic
ones, could rise again if spinners tried to grab
the floating stock in panic.
Unofficial sources said the unsold stock with the
ginners, according to April 1 arrival figures,
might not be more than 1.2m bales, including low-mic
lot and that might well prove to be a bullish
factor for them.
After a steep decline during the last couple of
sessions, New York cotton futures recovered from
the recent lows, up 1.09 and 1.28 cents at 62.62
and 64.63 cents per lb for both the ruling May and
the distant July contracts, respectively.
Official spot rates on the other hand were lowered
by Rs50 to Rs2,900 per maund in line with Friday's
rates at which stray business was done.
Ready business was light as till late on Saturday
evening about 2,000 bales, both inferior and
premium lots from the southern Punjab cotton belt,
changed hands between Rs2,600 and Rs2,950 per
maund without 15 per cent sales tax.
The following are Saturday's new crop Karachi
Cotton Association (KCA) official spot rates for
local dealings in Pak rupees for base grade 3
staple length 1-1/32" micronair value between 3.8
to 4.9 NCL.
Rate for Exgin price Ex-gin price
including Sales Tax Upcountry Expenses Spot rate
ex-Karachi
including Sales Tax @ 15%
37.32 kgs 2,900 3,335.00 50 3,385.00
Equivalent
40 kgs 3,108 3,574.20 50 3,624.20.
The DAWN |
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Pakissan.com; Advisory Point
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