960406

Cotton market decidedly steady

DR ZAFAR HASSAN

LAHORE: The cotton market prices on Saturday remained decidedly steady as the total lint requirements for the spinners and the Pakistani cotton exporters till the end of the 1995-96 season (September/August) are short by at least an estimated half a million bales (of 170 kgs. each) till the arrival of the next (1996-97) cotton season. Though the lint prices are well-held, some of the ginners always remain apprehensive lest the lint prices fall. Thus the ginners are wisely releasing their cotton stocks into the market, though sparingly.

In the meantime, reports from Faisalabad indicate that the cotton yarn and fabric prices are also registering a gradual increase. As the domestic, as well as New York cotton prices, are both on the increase, yarn price increases appear axiomatic. Even though the textile industries in the USA, Germany, Spain, Italy, France, Pakistan and China are not doing too well, rains in Southern Hemisphere country of Argentina has prompted values of lint to move up. Weather concerns in US cotton regions has also given boost to the New York futures.

The last Thursday rally and consequent closing rates in New York cotton futures has been described as the highest close for a most active contract since US cents 90.30 per pound settlement on October 6 last year. It remains probable the weather concerns in parts of USA and in Argentina could propel the cotton prices to cross the high hurdle of US cents 90 per pound in the foreseeable future. Unfortunately, the prices of cotton textiles are generally not moving proportionately upward along with those of raw cotton. More on the cotton front would be known next week when the markets open again in the USA and Europe after the Easter holidays.

On Thursday, the May 1996 delivery on the New York cotton exchange settled at US cents 87.55 per pound (up by 175 points), the July 1996 contract closed for the day at US cents 88.83 per pound (up by 187 points), while the October, 1996 delivery settled for the day at US cents 83.07 per pound (up by 62 points).

In ready transactions reported by the Karachi cotton brokers on Saturday, 200 bales from Shahdadpur sold at Rs 2150 per maund. However, 200 bales of Khairpur style from Mehrabpur are said to have sold at Rs 2200 per maund, the general price idea in that region being, however, upto Rs 2225 per maund. About 500 bales each of superior quality lint from Kot Diji and Bhiria Road are said to have been sold at Rs 2300 per maund each. The price range for better quality cotton from Upper Sindh (K-68) was reported from Rs 2325 to Rs 2350 per maund. In the Punjab, 300 bales from Multan reportedly sold at Rs 2260 per maund. However, 200 bales from Kahror Pucca and 1,000 bales from Rahimyar Khan sold at Rs 2325 and Rs 2350 per maund respectively.

The Pakistan Cotton Ginners Association (PCGA) has released statistics that for the 1995-96 season, seedcotton (Kapas) equivalent to 9,903,362 lint equivalent bales (of 170 kgs. each) had arrived into the ginning factories by the Ist of April, 1996. Furthermore, the domestic spinning mills had lifted 7,945,400 bales. The exporters 1,385,399 bales, while a balance of 5,71,523 bales of cotton, both in pressed and unpressed form, is lying unsold with all the ginning factories of Pakistan.

According to the Karachi Cotton Association (KCA), the spot rate of cotton for Niab-78 was fixed at Rs 2160 per maund on Saturday, Rs 2295 per maund for K-68, and Rs 2340 per maund for the MNH-93 variety. The KCA has also notified that cotton export registrations upto the first of April, 1996 with the Export Promotion Bureau (EPB) have now risen to 2,313,208 bales (of 170 kgs. each), and the actual cotton shipments of the 1995-96 cotton crop from Pakistan upto the 3rd of April, 1996 were 1,700,884 bales.