Cotton prices steady amid low trade on holiday schedule

KARACHI: Cotton market trade was low with stable prices during the three-day week, with Friday remaining a partial holiday, traders said.

Some ginning factories started their operations, while a majority of the mills were either closed or partially open, expecting trade to resume from Monday, they said.

Textile and spinning mills need cotton, increasing chances of higher trading activity in the coming days.

Activity is likely to increase in Punjab, while Sindh would face a normal situation, amid expected rains. “If rain is normal, it will benefit the crop, otherwise it can be harmful,” traders said.

Prices in the international market remained upwards during the week as dollar appreciated against rupee, making local cotton importers cautious of their deals. However, the market expects further increase in the dollar rate, which might help the exporters.

Sources in the textile sector said that there could be an increase in textile products in the coming days, as Covid cases were increasing in India and Bangladesh and lockdown was being increased with more strictness, especially in Bangladesh where international buyers had reduced buying.

Orders from India have also decreased and international buyers were giving more orders to Pakistani traders, which has resulted in an increase in the demand and prices of local textile products and cotton yarn.

Cotton prices in Sindh remained between Rs12,400 to Rs12,900 per maund, seed-cotton rates stood at Rs4,500 to Rs5,300 per 40kg while cottonseed was sold at Rs1,700 to Rs1,800 per maund.

In Punjab, lint prices remained at Rs13,200 to Rs13,500 per maund, seed-cotton at Rs5,200 to Rs6,000 per 40kg and cottonseed at Rs1,800 to Rs1,900 per maund.

Cotton prices in Balochistan remained at Rs12,900 to Rs13,000 per maund and seed-cotton was sold there at Rs5,000 to Rs5,300 per 40kg.

Karachi Cotton Brokers Association Chairman Naseem Usman told The News that prices remained upwards in the international market during the outgoing week.

Primes at the New York Cotton Market also increased and the rate remained at 89 to 90 cents per pound. According to a USDA report, cotton exports remained up 16 percent in season 2020-21. Prices also increase in Brazil, Central Asia, Africa, and India.

Sources said that the textile future of Pakistan would be vibrant, as more textile machinery was being imported and capacity was being enhanced. On the other hand, at the 6th meeting of the Uzbek-Pakistani Inter-governmental Commission on Trade-Economic and Scientific-Technical Cooperation (IGC) in Tashkent, All Pakistan Textile Mills Association (APTMA) signed a memorandum of understanding with the Governor of Bukhara, Uzbekistan to build a textile complex in the state. Spanning 30,000 hectares, the complex would reserve a vast space for cultivating cotton. It would also house spinning, weaving, processing, and garment units built for $100 million.

APTMA leader Gohar Ijaz hopes Pakistan’s cotton exports would reach $18 billion by next year. The country recently agreed to finalise a preferential trade agreement (PTA) with Uzbekistan within three months to boost bilateral trade volume.