LAHORE (January 23 2004):The exporters may have bought about 200,000 bales till the end of this month, while the ginners may still be retaining about 1.8 million bales of unsold cotton with them in both pressed and loose form.

We can thus see that lint prices are going up gradually with propensity to move even higher as time passes.

While the lower grades of cotton are easily available in the market. It is the higher class of cotton which is now commanding premium.

In the net analysis, cotton prices have moved up about Rs 50 per mound (37.32 kgs) this week.

Output for this season (2003-2004), is now mostly being gauged at about 9.5 million bales in Pakistan on an ex-gin basis but it could be marginally higher.

Though business volume is of routine proport1ons which is reported to connote a turnover ranging from 15,000 to 20,000 bales daily.

In an otherwise normal market, the pinch for better quality cotton may increase in its intensity.

The prices of seed-cotton (kapas/phutti) have also 1mproved though they were subdued last week like the prices of lint.

In Sindh, the prices of seed-cotton reportedly ranged from Rs 1050 to Rs 1400 per 40 kgs on Thursday, while the reported price for seed-cotton in the Punjab ranged from Rs 1100 to Rs 1425 per 40 kilogram's.

The price idea for lint from Mirpurkhas in Sindh reportedly ranged higher from Rs 2750 to Rs 2800 per mound (37.32 kgs) on Thursday without the 15 percent sales tax; in Sanghar, Shahdadpur or Tando Adam.

Lint prices reportedly ranged from Rs 2800 to Rs 3000 per mound according to quality; ginners from Nawabshah district were offering their lint from Rs 3000 to Rs 3050 per mound; in the Khairpur district, ginners were quoting from Rs 3050 to Rs 3100 for a mound of their cotton; in upper Sindh (K-68), cotton was being offered at about Rs 3250 per mound, while in the Punjab the asking rate for cotton ranged anywhere from Rs 2900 to Rs 3350 per mound according to the quality.

Despite the seasonal ups and downs over the past several months, the New York cotton futures are depicting an inner strength due to positive sentiments in the commodity markets the still weaker United States dollar against most other currencies, and improving economies around the world since the last 18 months or so.

Indian cotton prices have also gone up by several cents per pound, while offers for physical cotton mostly remain steady to firm at the other origins.

Speculative activity in New York and regular demand for United States cotton in several countries are also keeping the futures prices at elevated levels.

With the increase in cotton prices in India, mills there have started enquiring for imported cottons, one agent in India stated that recently the cotton prices there have gone out of control triggered mainly by poor arrivals and some sporadic buying.

One shipper in India was offering Gujarat Shankar-6 super, 28.5mm cotton length at 78.26 cents per pound C and F Karachi rates are said to have increased further thereafter.

Global enquiry for sundry cottons is likely to remain regular with China leading the other buyers this week the Chinese new year and next fortnight the Eid-ul-Azha on the holiday lists in many Muslim countries are both unlikely to have any effect which could ease the cotton prices.

The period following the interregnum is expected to buoy up the cotton prices again.

On last Wednesday, the March 2004 delivery on the New York cotton futures market settled positively at US cents 75.66 per pound (up by 39 points), the May 2004 delivery closed for the day at US cents 76.88 per pound (up by fifty 50 points), while the July 2004 delivery ended the session at US cents 77.55 per pound (up by 55 points), the undertone of cotton prices remained definitely positive as prices persisted to remain in positive territory for most of the session.

Courtesy Business Recorder