Spot rate remains firm in cotton market

KARACHI: The Karachi cotton market observed a firm trading session amid strong physical and cottonseed prices, traders at the Karachi Cotton Association (KCA) said Friday.
The KCA spot rate remained stable Rs 12,000 per maund while physical prices remained strong on back of fine lint’s growing demand above Rs 14,100 per maund, floor brokers said.
The spinning and mills units in Punjab bought lint of all grades on competitive prices while spinning sector in Sindh stations bought fine lint above Rs 14,000 per maund, they added.
The cottonseed supply in Punjab remained under the growers’ will as its prices hit record high at Rs 6,000 per maund, analyst Shakeel Ahmad said.
He said the prices in lint market were still strong and heading towards high on depleting stocks in Punjab and Sindh stations. Ahmad said the leading mills and spinning sectors with strong liquidity were still buying lint of all grades in order to maintain average price level of total stocks they bought earlier below Rs 10,000 per maund.
He said all grades of lint were fetching better prices above Rs 13,000 per maund and Rs 14,100 per maund.
He said some spinning units in Punjab bought all grades for blending purposes, as they have to fulfil local as well foreign demands for yarn.
Ahmad said trading in Punjab remained under price pressure where 15,000 bales changed hands while leading mills and spinning units also made some forward deals on a month’s credit basis above Rs 14,000 per maund.
Majority of the deals in Punjab took place at Rs 12,000 per maund to Rs 14,000 per maund depending on grade during the trading session. The deals in upper Sindh changed hands above Rs 13,400 per maund, while in Punjab buyers remained the volume leaders and made around 85 percent of the total deals to 19,200 bales.
The global lint prices were also on the higher side due to forward dealing in New York Cotton Market, growing demand of cloth and Indian ban on lint exports.
The New York Cotton Market March Futures remained on the higher side as May futures crossed 206 cents per pound and July 196 cents per pound, he added. Cotlook A Index closed at 231 cents per pound. staff report.

(Source: http://www.dailytimes.com.pk/default.asp?page=2011\03\05\story_5-3-2011_pg5_29)