Lint prices remain firm amid range-bound trading
KARACHI (May 22, 2011):: Lint prices remained firm while plenty of raw stocks changed hands on a week-on-week basis, traders at Karachi Cotton Association (KCA) said Saturday.
The spot rate stood firm at Rs 8,500 per maund on account of firm stand by the brokers and mills to support it throughout the week, traders said.
On Saturday, deals in low-grade lint changed hands at Rs 7,000 per maund in some stations as 99 percent cotton stocks were of raw quality, floor brokers said.
“The mills still owe billion of rupees to clear dues of ginners as they had bought thousands of bales on credit,” lint analyst Shakeel Ahmad said.
“They are still trying to keep the spot rate at present level of Rs 8,500 per maund in order to get bank loan on such level,” he added.
Ahmad said ginners in Punjab and Sindh stations having fine quality about 40,000 bales remained steadfast on their asking rates at around Rs 9,000 per maund. He said 80 percent transaction changed hands between spinners and private sector commercial exporters in Punjab and Sindh. “The exporter brought some fine stocks on better price on the back of increase in dollar value against rupee which resulted into costly imports,” he added.
“The spinner needs to make fine yarn to compete in world yarn market and cater to domestic requirements of local textile mills,” he maintained.
During the past week, 90 percent of the deals changed hands between spinners and sellers while mills with the ginning sector shared 10 percent deals.
During the past week, around 1.99 million bales changed hands as compared to 1.95 million bales in earlier week. On Saturday, around 8,000 bales changed hands in Sindh and Punjab stations with more than 85 percent Punjab’s share for around Rs 8,000 per maund to Rs 8,300 per maund depending on the grades.
According to United States Department of Agriculture reports, world’s output in fresh crop season will remain at 124.7 million bales, which is 9 percent up against last season’s output. Output in Pakistan will touch 14 million bales up by 19 percent against last year.
NYF July stood at 155.61 cents per pound, October Futures stayed at around 134.11 cents per pound. The Cotlook A Index stayed stable at 164.80 cents per pound.
Courtesy Daily Times