May 16, 2019

Cotton rates stable on modest trade.

Prices halted further decline on the cotton market on Wednesday in the process of modest trading activity, dealers said.

The official spot rate was unmoved at Rs 8650, they added. In the ready session, about 800 bales of cotton changed hands between Rs 8850-9500, they said.


Market sources said that leading participants were on the sidelines in the absence of fresh leads. The ginners were hoping that prices will increase in the coming days, they said. Dollar's surge versus the rupee is giving an impression that prices of products will go up sharply. So, the sellers keen to wait for proper time, they said.


Cotton analyst, Naseem Usman said that local cotton rates were coming down partly because of sharp decline in the international markets. Commenting on the dullness in the market, some analysts said that shortage of quality cotton coupled with lack of demand from spinners kept activity dull and dreamy.


The cultivation of new crop in the Punjab is under way and experts are terming the weather condition favourable, they said.


In the meantime, the cotton prices were likely to stay firm following the speculations of further decline in the value of the rupee against the dollar, they observed. In the open market, the dollar was trading at Rs 146.50, they said.


Adds Reuters: Cotton prices on Tuesday recovered from a near three-year low hit earlier in the session on renewed optimism that a trade war between China and the United States will be resolved and as poor weather delayed planting progress in the United States.


The most-active cotton contract on ICE Futures US July snapped six straights sessions of losses to gain 1.50 cent, or 2.3%, at 66.95 cents per lb as of 2:12 pm EDT (1812 GMT).


Total futures market volume fell by 20,890 to 45,020 lots. Data showed total open interest fell 1,717 to 219,333 contracts in the previous session.


Following deals were reported: nearly 200 bales of cotton from Ghotki sold at Rs 9500 (conditional) and 600 bales of cotton from Rahim Yar Khan at Rs 8850, they said.