Cotton spot rate up Rs300/40kg amid low trade

KARACHI: Cotton market remained high during the outgoing week with the spot rate increasing Rs300/40kg amid mixed trend around the world.

Prices in the New York Cotton market rose beyond 95 cents per pound, the highest level in seven years, to later drop by 2.18 cents per pound.

Trading activity in the local market during in week was low because of the religious holidays. Besides, ginners also remained cautious in selling, as they were already oversold. The supply of seed-cotton was moderate and prices increased along with those of lint.

On the other hand, big groups continued to import cotton at higher prices. Due to panic in the purchase of the lint, cotton prices moved up to Rs14,200/40kg in Punjab, the highest level in 11 years, later on, prices mimicked the fluctuation in New York Cotton Market.

After fluctuation, cotton prices in Sindh settled at Rs13,700-13,800/40kg in Sindh, where seed-cotton rates stayed at Rs5,500-6,200/40kg, while cottonseed rated remained at Rs1,700-1,800/kg.

Lint prices in Punjab traded between Rs13,900-14,200/40kg, seed-cotton at Rs5,500-6,200/40kg, while cotton-seed traded at Rs1,750-1,850/40kg.

Cotton rates in Balochistan hovered around Rs13,750-13,900/40kg, seed-cotton Rs5,900-6,300/40kg, and cottonseed around Rs1,800-1,900/40kg.

The spot rate committee of Karachi Cotton Association increased the spot rate by Rs300 to Rs13,800/40kg.

Chairman Karachi Cotton Brokers Association, Naseem Usman, told The News cotton rates in the international market were on the upside in the week. Rates in the New York Cotton Market hit a seven-year high during the week.

According to weekly USDA report, cotton export from the US declined despite of Chinese buying. In future contracts, Pakistan remained the biggest importer of US cotton. Prices increased in Brazil, central Asian states, and Africa, while prices were mostly stable in India.

On the other hand, stakeholders said the cotton crop was satisfactory in the country while cotton sowing was around 0.9 million acres below the target.

Production in Sindh is also up to the mark. However, plants growth was stubted because of scanty rains and pest attack. Cotton crop is in a better position in Digri, Nawabshah, Rohri, Dahrki, Ghotki, and other areas, according to reports.

Alarmingly, on the other hand, cargo shipment rates through the sea route have increased 700 percent and delays have increased by 45 to 90 days, which would affect Pakistan’s export shipments via sea route.