Some needy mills took interest in fresh buying on the cotton market on Saturday in the process of modest trading, dealers said. The official spot rate was higher by Rs 100 to Rs 6850, they said. In the ready session, around 2500 bales of cotton changed hands between Rs 6900 and Rs 7090, they said. Some brokers said that fresh buying interest was again witnessed as mills showed fresh interest in purchasing of fine quality.

Cotton analysts, Naseem Usman said that spinners were keen in buying of good quality, whereas the ginners were focusing on fresh selling as arrival of new crop is expected at the end of June. Other brokers said that nearly, four ginning units are likely to become operational in Sindh till June. Some experts said that incentives in the budget to the farm sector may not help in achieving the desired goals. In the meantime, cotton related people welcomed the starting of hedge trading.

According to reports, it may be noted that the Federal Finance Minister, Ishaq Dar has vowed to take the export to GDP ratio to 12 percent in 2017-18. The export industry sources said 12 percent export to GDP growth in 2017-18 is an impractical approach with 10 hours a day load shedding for the loss-ridden value-added textile industry. They said that the government was showing total apathy towards the problems faced by the value added textile industry.

So much so, they added, the prime minister had not extended audience to the export-oriented textile industry during first three years of his government. According to them, it happened first time in history that the government rolled back Refund Pay Orders (RPOs) against Sales tax refunds. The industry is likely to hold a joint strategy to deal with anti-industry, anti-investment and anti-export policy of the government next week and chances of strike are very much eminent against the hostile attitude of present government, said sources.

Adds Reuters: ICE cotton futures fell in muted trading on Friday, pressured by a stronger dollar and ahead of the US Memorial Day holiday weekend. The December cotton contract on ICE futures US settled down 0.43 cent, or 0.59 percent, at 72.79 cents per lb. It traded within a range of 72.69 and 73.45 cents a lb. The July cotton contract on ICE Futures US was mostly unchanged at 77.09 cents per lb. July prices have fallen about 12 percent since touching a near 3-year peak of 87.18 cents last week.

The December contract fell nearly 1 percent, while the July contract shed 3 percent this week. Total futures market volume fell by 10,850 to 16,244 lots. Data showed total open interest fell 1,988 to 243,943 contracts in the previous session. The following deals reported: 670 bales of cotton from Multan sold at Rs 6900, 400 bales from Noorpur Noranga at Rs 6965, 400 bales from Yazman Mandi at Rs 7000 and 1000 bales from Vehari at Rs 7090, they said.

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The KCA Official Spot Rate for Local Dealings in Pakistan Rupees

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FOR BASE GRADE 3 STAPLE LENGTH 1-1/16"

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                                    MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL

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Rate              Ex-Gin   Upcountry   Spot Rate    Spot Rate    Difference

                    For      Price     Ex-Karachi  Ex. KHI. As   Ex-Karachi

                                                  on 26.05.2017

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37.324 kg         6,850       135         6,985        6,885         +100/-

Equivalent

40 kgs            7,341       145         7,486        7,379         +107/-

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Copyright Business Recorder, 2017