Steady phutti arrivals may cause rates to decline in cotton trade

Increased phutti arrivals may cause fall in the prices as mills covered short position but easy supply encouraged them to stay on the sidelines to observe the development, dealers said. The Karachi Cotton Association (KCA) official spot rate was maintained at overnight level of Rs 6,450, they said.

Prices of seedcotton in Sindh were firm at Rs 2400-2900 and rates in Punjab were at Rs 2200-3100, they said. In ready dealings over 16,000 bales of cotton changed hands between Rs 5,550-6,800, they added. Commenting on the current position of cotton, Naseem Usman said that mills were on the sidelines due to strong phutti arrivals and this factor may bring down prices in the coming days. Other brokers said that the ginners may lower the asking prices as phutti arrivals are on rise and they don't have enough space to store phutti for a long-time.

According to a report, Brazil will play a bigger role in the global cotton supply in the coming years with a dramatic surge in output and rising exports of the fiber to its top trade partner China, a sector official told Reuters. The Latin American country's production of the fiber shot up to 1.96 million tonnes in 2011 from 1.2 million tonnes the year before, according to official data. Recent heavy capital investments signal these higher levels could be here to stay.

On Tuesday the NY cotton futures ended fractionally higher in see-saw business as players adjusted positions ahead of the release of a vital government crop tomorrow, analysts said. The key December cotton contract on ICE Futures US rose 0.13 cent to end at $1.047 per lb, trading from $1.0269 to $1.04. The market has traded in a rough band from 98 cents to $1.04 for the last 13 sessions. Total volume traded on Monday hit almost 9,400 lots, about a quarter under the 30-day norm, preliminary Thomson Reuters data showed.

The following deals were reported: 600 bales of cotton from Khipro sold at Rs 5550-5600, 200 bales of cotton from Nawabshah at Rs 5600, 2000 bales of cotton from Khair Pur at Rs 6500, 800 bales of cotton from Upper Sindh at Rs 6500, 400 bales of cotton from Darran Wala at Rs 6200, 600 bales of cotton from Haroonabad at Rs 6200/6250, 200 bales of cotton from Mailsi at Rs 6300, 200 bales of cotton from Lodhran at Rs 6300, 400 bales of cotton from Faqirwali at Rs 6300/6400, 400 bales of cotton from Hasil Pur at Rs 6350, 400 bales of cotton from Gajjo mandi at Rs 6390/6550, 200 bales of cotton from Marott at Rs 6400, 1000 bales of cotton from Chichawatni at Rs 6400/6500, 200 bales of cotton from Multan at Rs 6400, 400 bales of cotton from Layyah at Rs 6400/6500, 400 bales of cotton from Garh Maharaja at Rs 6400/6425, 400 bales of cotton from Bahawal Pur at Rs 6400, 200 bales of cotton from Jahanian at Rs 6425, 400 bales of cotton from Sahiwal at Rs 6450, 200 bales of cotton from Bakkhar at Rs 6500, 200 bales of cotton from Uch Sharif at Rs 6500, 1200 bales of cotton from Sadiqabad at Rs 6500, 200 bales of cotton from Arif Wala at Rs 6500, 200 bales of cotton from Karoor pacca at Rs 6550, 200 bales of cotton from Sillan Wali at Rs 6550, 200 bales of cotton from Yazman Mandi at Rs 6550, 600 bales of cotton from Burewala at Rs 6550, 200 bales of cotton from Mian Chanon at Rs 6600, 400 bales of cotton from Khanewal at Rs 6600, 1200 bales of cotton from Rajan Pur at Rs 6600 and 200 bales of cotton from Mianwali at Rs 6800.