Cotton prices continued to climb Thursday in Pakistan breaking all previous records for better quality crop. On previous day spot rate at the Karachi Cotton Association (KCA) increased by Rs 75 to Rs 4,700, breaking all previous records.
More than 17000 bales of cotton sold within the range of 4600-5500. One contract from Khanpur was executed at Rs 4950 which was the highest in the current season.
Phutti prices in both the Punjab and Sindh were same at Rs 2050-2350, they added. Some cotton analysts said that the mills, which were trying to purchase fine quality, offering high prices to save themselves from future losses.
The basic reason behind the surge in prices is short supply of cotton despite having good crop of cotton during the current season, they said. They said that the country imported one million bales of cotton from neighbouring India, and still it needs to import more than two million bales of cotton to make up the balance, they said.
The emerging circumstances are in favour of ginners, because they are in commanding position, sometime ago, the mills were sidelined as they were anticipating that the ginners will oblige them by lowering prices, instead, they (mills and spinners) were trying to get better quality after paying high rate. On Tuesday the NY cotton futures finished near a four-week high on all-around buying sparked by a bullish government supply/demand report, and some follow-through interest should lift prices this week, brokers said.
The key March cotton contract rose by 3.00-cent limit to end at 72.16 cents per lb, with the session low at 69 cents. It was the highest finish for cotton on the spot daily charts since the middle of January, when it traded near 73 cents. Volume in the March contract hit 21,875 lots at 2:54 pm EST (1954 GMT).