Prices Firm on Lacklustre Cotton Market
Prices maintained overnight level amid lacklustre business on the cotton market on Saturday, dealers said. The official spot rate was unchanged at Rs 5,250, dealers said. In Sindh, seed cotton prices were at Rs 2000-2200, and in Punjab prices at Rs 2500 and Rs 2900, they said. Some brokers said that spot rate showed no change despite listless business owing to lack of buying interest.
Experts said that activity was subdued partly because of rains in Punjab, they said that the ginners were trying to refrain from fresh selling on perception of better rates. If rains prolonged for a long-time, the prices may go up and so that we can see slight recovery in demand and prices, as well, they observed. The unsold cotton stock with the ginners harming growers, who have already suffered owing to crop failure in the Punjab, they said.
Other analysts said that the spinners have reduced their routine business due to falling trend in the international market, thanks to the NY cotton futures, which have started picking up for the last couple of sessions.
Reuters adds: Cotton futures gained for a second straight session on Friday, amid a broad rally in commodities and equities markets, rising further from a more than 6-1/2-year low struck on Thursday. Prices still finished the week lower. The cotton market is “breaking a downtrend line,” which could increase short covering, said Michael McDougall, director of commodities for Societe Generale in New York, adding that a break above the 57.90 cent per lb mark could signal a test of the 60 cent level. The May contract on ICE Futures US settled up 0.32 cent, or 0.56 percent-the biggest intra-day percentage gain in a week-at 57.15 cents per lb, after trading as high as 57.45 cents. The contract fell about 3 percent this week.

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