Phutti prices up amid strong buying by mills
Further improvement in quality of seed cotton boosted prices on the cotton market on Monday in process of good trading. Official spot rate was unchanged at Rs 5,200. In the ready business, over 16,000 bales of cotton changed hands between Rs 4875-5450.
Prices of seedcotton of inferior type was down by Rs 200 to Rs 2200 while the best type picked up Rs 100 to Rs 2500, in Sindh low type gained Rs 100 to Rs 2100 and the good type showed no change at Rs 2400. Market sources said that mills, spinners and exporters were active to cover the immediate needs despite the higher trend in the prices.
The quality of seed cotton is showing an improvement and this is the only factor, which is attracting the buyers, cotton analyst Naseem Usman said and adding that the cotton traders were hoping textile sector to depict better performance in the coming days. It appeared that the European Union has cleared the way for preferential treatment of Pak exports and if all goes well, Paki textile as well as some other smaller categories would start benefiting from the next year. After monsoon rains, the current year's cotton production may be 15 and 15.5 million bales against the last year's cotton production of 14.8 million bales.
The following deals reported: 2400 bales of cotton from Shahdad Pur at Rs 5300-5400, 1800 bales from Sanghar at Rs 5300, 2000 bales from Tando Adam at Rs 5300/5400, 2000 bales from Mir Pur Khas at Rs 5200/5350, 1200 bales from Khair pur at Rs 5400-5450, 1400 bales from Upper Sindh at Rs 5400, 400 bales from Mian Chano at Rs 4700-4950, 200 bales from Chichawatni at Rs 4875, 200 bales from Burewala at Rs 5100, 200 bales from Vehari at Rs 5100, 200 bales from Kasso Wal at Rs 5100, 200 bales from Mubarik Pur at Rs 5100, 800 bales from Hasil Pur at Rs 5200-5250, 400 bales from Fort Abbas at Rs 5250, 400 bales from Harrapa at Rs 5300, 400 bales from Khichi Wala at Rs 5300, 2600 bales from Haroonabad at Rs 5300/5325.
Prices of seedcotton of inferior type was down by Rs 200 to Rs 2200 while the best type picked up Rs 100 to Rs 2500, in Sindh low type gained Rs 100 to Rs 2100 and the good type showed no change at Rs 2400. Market sources said that mills, spinners and exporters were active to cover the immediate needs despite the higher trend in the prices.
The quality of seed cotton is showing an improvement and this is the only factor, which is attracting the buyers, cotton analyst Naseem Usman said and adding that the cotton traders were hoping textile sector to depict better performance in the coming days. It appeared that the European Union has cleared the way for preferential treatment of Pak exports and if all goes well, Paki textile as well as some other smaller categories would start benefiting from the next year. After monsoon rains, the current year's cotton production may be 15 and 15.5 million bales against the last year's cotton production of 14.8 million bales.
The following deals reported: 2400 bales of cotton from Shahdad Pur at Rs 5300-5400, 1800 bales from Sanghar at Rs 5300, 2000 bales from Tando Adam at Rs 5300/5400, 2000 bales from Mir Pur Khas at Rs 5200/5350, 1200 bales from Khair pur at Rs 5400-5450, 1400 bales from Upper Sindh at Rs 5400, 400 bales from Mian Chano at Rs 4700-4950, 200 bales from Chichawatni at Rs 4875, 200 bales from Burewala at Rs 5100, 200 bales from Vehari at Rs 5100, 200 bales from Kasso Wal at Rs 5100, 200 bales from Mubarik Pur at Rs 5100, 800 bales from Hasil Pur at Rs 5200-5250, 400 bales from Fort Abbas at Rs 5250, 400 bales from Harrapa at Rs 5300, 400 bales from Khichi Wala at Rs 5300, 2600 bales from Haroonabad at Rs 5300/5325.
New York cotton ends third quarter down 1.3 percent
Cotton ended the third quarter lower as speculative investors unwound bullish bets and seasonal selling started ahead of the Northern Hemisphere harvest amid expectations of a record surplus. Selling accelerated in the past two weeks amid fears that China will start unloading a portion of its massive strategic stockpile.
Building on its 24 percent plunge in the second quarter, New York cotton for December delivery ended the quarter at 70.65 cents per lb on ICE Futures US, down 1.3 percent from the end of June. That was down 1.2 percent from Thursday's settlement. "The harvest pressure has become apparent. I'm surprised it's not doing better. It's the last day of the month and quarter, and the specs have got short," said Sharon Johnson, a cotton specialist at Knight Futures in Atlanta, Georgia. Speculative investors have opened new shorts this week, traders say, pointing to a 3 percent rise in open interest - contracts outstanding - to almost 190,000 lots this week, its highest since mid-June.
Hedge funds and other speculative investors almost halved their net long position in the week to September 25, the Commodities Futures Trade Commission data showed on Friday. The net long of just over 10,000 lots revealed this group of investors were at their most bearish since mid-August.
Even so, the market remained on weather watch, with rain in the US mid-South, a major cotton growing area, this far into the Northern Hemisphere season potentially hurting relatively mature crops. Certified exchange stocks have dwindled, but this season's inventory is expected to exceed 76 million bales, setting new records. Technically, prices were close to being oversold with a reading of 36 on a Relative Strength Index (RSI), its lowest since early June. A reading below 30 represents oversold territory.
But after failing to pierce 80 cents in August and having broken out of recent narrow ranges to the downside, fibres are on technically weak ground. Traders expect prices to test 69 cents ahead of the harvest. The Thomson Reuters-Jefferies CRB index, a global benchmark for commodities, was on course to post a gain of nearly 9 percent in the third quarter, the biggest rise since the fourth quarter of 2010. It was up 0.64 percent on the day.
Building on its 24 percent plunge in the second quarter, New York cotton for December delivery ended the quarter at 70.65 cents per lb on ICE Futures US, down 1.3 percent from the end of June. That was down 1.2 percent from Thursday's settlement. "The harvest pressure has become apparent. I'm surprised it's not doing better. It's the last day of the month and quarter, and the specs have got short," said Sharon Johnson, a cotton specialist at Knight Futures in Atlanta, Georgia. Speculative investors have opened new shorts this week, traders say, pointing to a 3 percent rise in open interest - contracts outstanding - to almost 190,000 lots this week, its highest since mid-June.
Hedge funds and other speculative investors almost halved their net long position in the week to September 25, the Commodities Futures Trade Commission data showed on Friday. The net long of just over 10,000 lots revealed this group of investors were at their most bearish since mid-August.
Even so, the market remained on weather watch, with rain in the US mid-South, a major cotton growing area, this far into the Northern Hemisphere season potentially hurting relatively mature crops. Certified exchange stocks have dwindled, but this season's inventory is expected to exceed 76 million bales, setting new records. Technically, prices were close to being oversold with a reading of 36 on a Relative Strength Index (RSI), its lowest since early June. A reading below 30 represents oversold territory.
But after failing to pierce 80 cents in August and having broken out of recent narrow ranges to the downside, fibres are on technically weak ground. Traders expect prices to test 69 cents ahead of the harvest. The Thomson Reuters-Jefferies CRB index, a global benchmark for commodities, was on course to post a gain of nearly 9 percent in the third quarter, the biggest rise since the fourth quarter of 2010. It was up 0.64 percent on the day.
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