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No buying activity on cotton market
KARACHI, March 27: Physical business on the cotton
market on Friday remained insipid as spinners and
mills again kept to the sidelines apparently
awaiting confirmation of fresh export orders for
the quarter ending June 30.
But some leading brokers said a lot of business is
being transacted off-the-floor between Punjab
ginners and spinners, details of which are not
immediately available.
The unsold stocks lying with the ginners in the
final crop report due in the first week of the
next month will show the actual position of both
the total crop and the stocks held by the ginners,
they said, adding "that will set the future price
trend".
But some others said the daily mill ready offtake
was affected by the highly erratic price movements
of the New York cotton futures, which did not
allow them to plan for long-term basis. Any
further fall in prices could have negative impact
on our exports of textiles and cotton yarn,
spinners said.
However, the local prices remained stable between
Rs2,700 to Rs3,000 per maund depending on quality
and were not immediately affected by the uneven
fluctuations on the world markets, they said.
"Leading spinners and mills who had built up long
positions earlier in the season at much lower
rates and through imports around 62 cents per lb
are not worried over the supply and demand
factors", analysts said "but their weaker links
face some problems partly on account of their
liquidity position and partly to the absence of
willing sellers".
Some of leading spinners have increased the use of
synthetic fibre in their blended yarn meant for
export markets, which in turn has reduced their
intake of lint, dealers said.
Meanwhile, reports originating from the
end-product users, notably the ancillary industry
indicate a modest increase in yarn prices in
sympathy with synthetic fibre, which add to their
export parity levels.
Reports from the New York Cotton Exchange were
bearish as both the future contracts have suffered
fresh decline ranging from 1.06 and 0.94 cents per
lb for both the ruling May and the distant July
settlements.
Official spot rates on the other hand remained
pegged at the last close in the absence of
comparative figures from the ready market. Ready
offtake was light as barring a fresh deal of 1,000
bales from a Rahimyar Khan ginnery at Rs3,000, no
other deal was reported by the brokers.
The following are Friday'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 2,975 3,421.25 50 3,471.25
Equivalent
40 kgs 3,188 3,666.20 50 3,716.20.
The DAWN |
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Pakissan.com; Advisory Point
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