NEW DELHI: Cotton prices continued to rise sharply this week on continuous fears that the current crop (August 2015 / July 2016) is much shorter than envisaged earlier. Some observers put it as low to range between 12 and 12.5 million bales (155 kgs) and the quality of cotton has also said to have suffered notably. Mills may consume anywhere from 14.5 to 15 million bales and may also have to import 1.25 to 1.50 million bales. Exporters could ship anywhere from 700,000 to 800,000 bales.
A rise in seed cotton (kapas / phutti) of Rs. 300 to Rs. 400 per 40 kgs has been recorded and the prices of cottonseed (Binola / Kakra) and oilcake (Khal) have also risen commensurately. Similarly, lint prices are also said to have shot up by Rs. 300 to Rs. 400 per maund (37.32 kgs) since the beginning of this week. Traders added that due to rise in local cotton prices a parity has been reached to import cotton at commensurate rates. Thus some Pakistani mills are reported to have booked cotton for import from India, West Africa and Brazil.
Generally speaking, seed cotton prices are said to have ranged higher from Rs. 2,600 to Rs. 2,900 per 40 kgs, according to the quality. Lint prices on Thursday are said to have ranged from Rs. 4,850 to Rs. 5,400 per maund (37.32 kgs) in Sindh, while in the Punjab they were said to have extended from Rs. 5,200 to Rs. 5,400 per maund in a tightly held market.
In ready sales in Sindh on Thursday, 400 bales of cotton from Bhiria Road reportedly sold at Rs. 5,250 per maund (37.32 kgs), 2,000 bales from Khairpur sold at Rs. 5,300 / Rs. 5,350 per maund, while 1,000 bales from Upper Sindh were said to have been sold at Rs. 5,350 / Rs. 5,400 per maund.
In the Punjab, 400 bales of cotton from Lodhran were said to have been sold at Rs. 5,300 per maund, while 400 bales from Mianwali sold at Rs. 5,400 per maund. Domestic mills have become eager buyers of cotton even though the prices of cotton have become firmer due to crop shortage in the country. Traders added from Karachi that cotton exporters are also buying in the market.
According to the Pakistan Cotton Ginner’s Association (PCGA) seed cotton arrival report for the current season (August 2015 / July 2016), 3,073,325 lint-equivalent bales arrived into the ginning factories till the 1st of October, 2015 from which the domestic mills have lifted 2,212,900 bales. Exporters have picked up 230,190 bales while the ginners still hold an unsold quantity of 630,235 bales, both in loose and pressed form.
