Cotton market on Saturday witnessed slow down in trading activity following the governmentâ€™s decision to withdraw duty and taxes on lint imports. This is a timely decision because much of the local cotton had already been lifted by spinners and very little quantity is left with growers and ginners.
Though world cotton prices are currently on the higher side, it seems that many buyers would like to exercise the option of imports after the government removed 4 percent customs duty and 5pc sales tax on lint imports.
The demand for removal of duty and taxes was raised by All Pakistan Textile Mills Association (Aptma) and this has now opened up another source for meeting cotton shortage, observed Adnan Naseem director Karachi Cotton Association (KCA).
At the Karachi Cotton Association, the spot rates remained unchanged at overnight level.
The following deals were reported to have changed hands on ready counter: 3,100 bales, Sadiqabad, at Rs8,050 to Rs8,075; 800 bales, Mirpur Diwan, at Rs8,000; 800 bales, Shaher Sultan, at Rs7,600; 400 bales, Mian Channu, at Rs7,300; and 1,00 bales, Vehari, at Rs6,500.
There is a possibility that demand for cotton would rise in coming days because over 250 Pakistani exporters are participating in Heimtextil, Frankfurt which is the largest home textiles fair in the world.
Against this, Indian exporters of home textiles are faced with high cost of cotton and yarn and this could not be in their favour at this juncture when huge orders are usually placed by world leading brands for their the entire year consumption.
Reports suggest that around 5,000 bales of Indian cotton have reached KaraÂ¬chi port. However, there are little prospects that all the booked orders by Pakistani spinners of around 0.5 million bales with Indian exporters would be honored because of a sudden rise in Indian cotton prices.
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