KCA spot rate raised by Rs 100 to Rs 7,550； upward trend persists on cotton market

KARACHI  (October 21, 2010) : Higher trend persisted on the cotton market on

Wednesday as mills and exporters continued buying to meet the immediate

requirements, dealers said. The Karachi Cotton Association (KCA) official spot

rate was raised by Rs 100 to Rs 7550, they said.

In the ready business more than 34,000 bales of cotton changed hands between Rs

5450-7700, they said. Seed cotton prices in Sindh were at Rs 3400-3550, in Punjab

at Rs 3200-3400, they said. According to the market sources mills showed interest

in fresh buying due to continued rise in the prices and it seems that the prices

may go up further in the coming days due to short supply.

On Tuesday the US cotton futures fell 2.7 percent as a dollar rally on the back of

China's surprise decision to increase interest rates to cool demand encouraged

investors to sell holdings of cotton and other commodities. The US cotton market,

which hit its highest level since the American Civil War last Friday, reeled from

the announcement by China, the No 1 cotton importer. According to Sterling Smith,

analyst for brokers Country Hedging Inc.

ICE Futures US key December cotton contract fell 3.11 cents to close at $1.1026

per lb, near the bottom of its $1.0925 to $1.1475 band. Total volume traded in the

cotton market stood at 20,808 lots at 2:52 pm EDT (1852 GMT), nearly 5.0 percent

below the 30-day average at 21,818 lots, preliminary Thomson Reuters data showed.

The following deals were reported: 2000 bales of cotton from Tando Adam sold at Rs

7600-7650, 4000 bales from Mir Pur Khas at Rs 7600, 3000 bales from Shahdad Pur at

Rs 7600, 2400 bales from Sanghar at Rs 7500/7550, 400 bales from Karachi (Mach

Goth) at Rs 7640, 3200 bales from Khair Pur at Rs 7600/7650, 3600 bales from Upper

Sindh at Rs 7700, 3000 bales from Nawahshah at Rs 7600/7650, 200 bales from

Mianwali at Rs 7700, 200 bales from Shahdan lund at Rs 7700, 2000 bales from Rajan

Pur at Rs 7700, 200 bales from Tonsa Sharif at Rs 7700, 200 bales from Dera Ghazi

Khan at Rs 7625, 1400 bales from Burewala at Rs 7550/7600, 2000 bales from

Khanewal at Rs 7500/7600, 600 bales from Chichawatni at Rs 7600, 800 bales from

Layyah at Rs 7600, 400 bales from Uch Sharif at Rs 7500, 400 bales from Chistian

at Rs 7450, 2000 bales from Bahawal Pur at Rs 7500, 400 bales from Bahawal Nagar

at Rs 7500.