Cotton prices soar to new high level

On sustained demand for quality cotton from spinners and some exporters due to which cotton prices soared to a new high level on Wednesday. However, no much expansion see in the trading volume as ginners were reluctant to dispose of their stocks.

Buyers were not ready to cross a certain price limit, whereas sellers were eager to get best price due to wide gap between demand and supply.
The wide gap between consumption and production keeps spinners extremely worried about source of future supply of cotton to keep the industry wheels moving, brokers said.

According to private estimates, the current season’s crop size would be at around 10.8 million bales that would mean, around 4m bales short against the consumption.

In Sindh, seed cotton prices were at Rs 3000-3300, while in Punjab, phutti rates stayed put at Rs 3200 and Rs 3550, as per 40 kg, dealers said.

In the ready session, around 5,000 bales of cotton changed hands between Rs 6600 and Rs 6800.

According to market sources, the PCGA released its fortnightly report of cotton production at 10.535 million bales, depicting a rise of 11.19 percent against the last year.

Cotton analyst, Naseem Usman observed that as a result of persistent firmness, cotton yarn prices went up slightly and it looks that rates may maintain upward march in the coming days.

Major deals to have changed hands as per dealers were: 200 bales from Alipur (Rs6,600), 1,000 bales Lodhran (Rs6,650 to Rs6,750), 400 bales Jahanian (Rs6,700), 1,000 bales Rahimyar Khan (Rs6,600 to Rs6,700), 1,200 bales Khanpur (Rs6,700) and 1,000 bales Jalalpur (Rs6,500 to Rs6,800).

The official spot rate after maintaining a stable trend for a long time, managed to gain Rs 75 to Rs 6450, dealers said