Floor brokers said that the start of third picking earlier than the schedule and arrivals of low quality phutti (seed cotton) caused some panic among spinners who kept looking for quality lint.
The shortage of quality lint is instrumental in pushing cotton prices higher as spinners are worried about their commitments of quality cotton yarn. The market is presently faced with short supply of quality cotton, brokers said.
Meanwhile, the Trading Corporation of Pakistan (TCP) has approached the government to allow the disposal of last year’s cotton stocks of around 86,000 bales through small lots. The corporation had been striving hard to sell these stocks through tenders but the buyers are not ready to deposit 10 per cent towards sales tax fearing they will face difficulty in getting refunds.
The Economic Coordination Committee (ECC) is meeting today and the TCP’s issue is reported to be on its agenda. The corporation made four attempts to sell the cotton stocks through tenders but to no avail, official sources said.
The Karachi Cotton Association (KCA) raised its spot rates by Rs50 to Rs5,350 per maund. The New York cotton market opened on weekend easy tone where all the future contracts closed lower.
Major deals on ready counter were: 2000 bales from Khairpur done at Rs5400 to Rs5450, 1600 bales Sukkur at Rs5450 to Rs5500, 1000 bales upper Sindh at Rs5650, 1400 bales Faqirwali at Rs5450, 1000 bales Sadiqabad at Rs5600, 800 bales Mianwali at Rs5675 to Rs5700, 800 bales Khanpur at Rs5600, 800 bales Fazilpur at Rs5600, 600 bales Fort Abbas at Rs5500 to Rs5550 and 400 bales Dharnawala at Rs5350.
News source: Dawn