Cotton

[rakeshmalik]

Pakistan's cotton production eyed up
28 Jun 2008 10:15 am

Chicago - Pakistan's cotton production may increase in 2008-09 as farmers shift out of sugarcane acres due to low prices and administrative issues, Rabobank says in a report. Cotton in Pakistan is still under threat from the mealybugs and cotton leaf curl virus that cut into the country's 2007-08 crop, the report says.
...................................................................................................................... China's cotton imports may rise
28 Jun 2008 10:20 am

Chicago - China is expected to increase cotton imports amid expectations for its growing share of global cotton consumption and reduced production in the country, Rabobank says in a research report. Chinese cotton consumption in 2007-08 is likely to be over 43 per cent of the world total, growing into 2008-09 as mill use slows in Europe and the US, according to the report.

Cotton production in China may slow dramatically as a push toward grains and oilseeds consumes more acreage, though cotton acres may see a boost from its government's plan to subsidize improved cotton seeds for farmers, the report says.

The supply and demand scenario is favorable to US cotton exports despite China's interest in sourcing more cotton from Africa, the report says. African growth is slow, volatility there is high and cotton yields are low, says Michael Whitehead, vice president of food and agribusiness research and advisory at Rabobank.
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ICE cotton slips in thin trade
28 Jun 2008 10:19 am



New York - ICE Futures US cotton settled lower Friday in anemic trade as the market awaits Monday's acreage report.

Most active December futures settled 37 points lower at 81.40 cents a pound, and the nearby July contract settled down 68 points at 73.41c. For the week, the December contract gained 129 points.

Futures opened slightly lower, but then moved higher on strength from the softer U.S. dollar and strong CRB Index. The market hit buy stops, but December found resistance at the session high of 82.59c, falling back to support at 80.77c. Futures trimmed some losses to move near unchanged but slid into the close.

Traders put on anticipatory positions ahead of the U.S. Department of Agriculture's acreage report in Friday's session, said Ron Lawson, partner at LOGIC Advisors in Napa Valley, Calif.

"There's two numbers in everybody's mind: what they really think the crop is and what they think the USDA will say on Monday," Lawson said.

Analysts surveyed by Dow Jones Newswires expect acreage to slip to 8.89 acres, down from the 9.38 million acres projected by the USDA in May. Inclement weather in West Texas likely cut into more acres since the survey to determine the new projection that was taken, analysts said.

Traders will be quick to buy if the market drops on a bearish estimate, Lawson said.

The 2008-09 cotton acreage report is scheduled to be released at 8:30 a.m. EDT (12:30 GMT) Monday.

Following reaction to the report, the market could find support from West Texas weather if crop conditions deteriorate, said Rob Kurzatkowski, futures analyst at optionsXpress in Chicago.

Otherwise, the market will trade choppily in search of direction, he said.

Technically, overhead resistance from 82-82.60c basis December contracts remains an obstacle, said Mike Stevens, analyst at SFS Futures in Mandeville, La.

ICE daily cotton stocks increased by 6,049 480-pound bales Thursday to total 1.64 million bales, with 46,539 awaiting review.

ICE cotton open interest increased by 1,691 positions Thursday to total 216,732, according to the exchange.

Volume was estimated 9,405 lots. In options, approximately 3,722 calls and 2,642 puts traded, according to exchange data.

Close Change Range
Jul 73.41 -68 pts 73.41-74.90
Oct 78.11 -28 pts 77.50-79.06
Dec 81.40 -37 pts 80.77-82.59

 

[rakeshmalik]

'Mites, white fly, mealy bug spoiling cotton crop'

MULTAN (June 28 2008): Agriculture expert Bahadur Ali Shah has said that the cotton crop is being spoiled by three major pests Mites, White Fly and Mealy Bug. Everybody belonging to Private or Public Sector was of the opinion that although the cropped area target will not be met but the crop situation and the introduction of BT Cotton will cover the gap up to some extent. He expressed his views while talking with Business Recorder.

He said but suddenly, the attacks of insects have appeared in severe shape. To overcome this menace it was required that all the agencies responsible for this job should put out all efforts to track the farmers to control these insects below the economic injury level.

It is known that the people, in this sector, especially, at dealer's level is not so learned that they should put all the things in proper and good-looking manner. In this way harassment is found in the market and everybody is trying to escape such minor human errors by putting extraordinary time and devoting their energies in this issue.

"No one is against the activities to catch hold the culprits and the black sheep of this sector," he said adding, but yet we have to decide, what is the percentage of such persons who are involved in adulterated products' supply and sale? The data about the history of this issue shows that the ratio is below one percent and sub-standard products are not more than two percent. Could you compare this ratio with other crimes in other professions such as Pharmaceuticals, Food Items and many more?

He said to put so much emphasis and mobilisation of all the Government Machinery to check this ratio seems that only harassment may be spread in the field and the actual concentration to control the insects is put in the back yard. Is it a justified approach and what results or merits and demerits will come out of this exercise?

He further said it is suggested that the departments should be mobilised to teach the farmers to control these insects and hot spots should be pointed out to overcome at the initial level. If no proper attention will be given on this chapter, the cotton crop will be at its worst position, he added. Moreover, the supply of adequate pesticides may be checked with a high level meeting with Private Sector. The product to control the Mites.

 

[rakeshmalik]

Indian edible oil prices down on slack domestic demand
28 Jun 2008 10:27 am

Mumbai - Indian edible oil prices during the week ended Friday ended tad lower due to a lull in demand in local markets.

However, traders expect prices to resume their rise in the coming weeks on firm overseas trend and supply tightness in local markets.

Low availability of soybean and rapeseed has affected supply of soft oils in the market and this squeeze is likely to continue until the new soybean crop arrives, said Ramesh Malpani, a trader in the major soybean producing province of Madhya Pradesh.

Farm Ministry data released Friday show area under oilseed cultivation during June 1-27 was up at 1.92 million hectares compared with 1.84 million hectares a year earlier.

Sowing of soybean was carried out in 811,000 hectares down from 996,000 hectares a year earlier.

"In Madhya Pradesh, soybean sowing has been lagging due to inadequate rainfall. Only around 30%-40% has been sown as of now," said Malpani.

This would delay the new crop arrival by two-three weeks, he said, extending the supply deficit in the country.

However, area under groundnut cultivation was 904,000 hectares, up from 506,000 hectares, the government data showed.

Although the government has announced the sale of edible oils at a subsidized rates from July, the trader said that the additional supply is unlikely to depress prices as the quantity is not enough to meet local demand.

The government plans to distribute 1 million metric tons of imported edible oils at a subsidy of 15 rupees (USD0.35) a kilogram to lower income households.

The four state-run trading houses, namely PEC Ltd, MMTC Ltd, State Trading Corp, and National Agricultural Cooperative Marketing Federation, have contracted to import 179,000 tons of edible oils till now, the government said.

Floods in US Midwest and a firm trend in Malaysian palm oil prices will also keep local prices on the upswing in the coming days, traders said.

In India, price of local edible oils is directly impacted by international markets as the country imports nearly half of its annual edible oil demand.

It buys soyoil from Argentina and Brazil and palm oil from Malaysia and Indonesia.

Local refined soyoil was at Rs 67,000/ton Friday, down from Rs 67,300/ton a week earlier.

Refined, bleached and deodorized palm olein was at Rs 57,600/ton, down from Rs 58,400/ton.

Crude palm oil was trading at Rs 51,300/ton, down from Rs 51,500/ton a week earlier.

 

[rakeshmalik]

Cotton lint above Rs 2,900/maund
30 Jun 2008 4:50 pm

Abohar - Cotton lint prices jumped Rs 10-Rs 15/maund to cross the level of Rs 2,900/maund at major markets across north India Monday. Limited stocks in the region and consistent demand from millers is pushing cotton lint prices higher since last few days. Traders say, the reports of likely ban on cotton exports and reduction in import duty are not having any effect on the market.

Across Punjab, cotton lint traded at Rs 2,915-Rs 2,920/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,915-Rs 2,920/maund at Malot and Gidarbha; Rs 2,905-Rs 2,910/maund at Abohar; Rs 2,905-Rs 2,910/maund at Manasa; and at Rs 2,930-Rs 2,935/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,835-Rs 2,850/maund in Haryana and at Rs 2,675-Rs 2,710/maund in Rajasthan.

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Cotton lint trades firm in west India
30 Jun 2008 4:56 pm

Mumbai - Cotton lint prices were quoted steady-to-higher amid normal buying at major markets across western India Monday. Consistent demand from millers and limited stocks in the region are providing good support to cotton lint prices. According to traders' estimate, around 11 lakh bales of cotton lint is remaining in the country. Traders say, the reports of likely ban on cotton exports and reduction in import duty are not having any effect on the market.

At Kadi market in Gujarat, cotton lint S-6 A-grade was quoted at Rs 27,200-Rs 27,500/candy while average-grade traded at Rs 26,900-Rs 27,100/candy.

In Vidarbha region of Maharashtra, the 28-mm cotton lint traded at Rs 27,500-Rs 27,800/candy while 29-mm cotton lint traded at Rs 28,000-Rs 28,500/candy.

At Sendhwa market in Madhya Pradesh, the 28-mm cotton lint traded at Rs 27,300-Rs 27,900/candy; 29-mm cotton lint traded at Rs 28,000-Rs 28,500/candy; and 30 mm cotton lint at Rs 28,700/candy.

 

[rakeshmalik]

Rains in Punjab may hinder phutti arrival

KARACHI (July 01 2008): Rains in cotton-belt in Punjab may cause problems in phutti transportation in the short run and also help in stabilising the prices , dealers said at the cotton market on Monday. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3750, dealers said.

Rains started in most part of Punjab and it could be a factor behind the slowdown in arrivals, they said. According to the market sources, since the phutti arrival started, the prices came down and it seems that prices may show further weakness in the coming days. They also said that uncertainty about the size of total crop may be a leading factor for both mills and ginners. Some broker said few sessions were dull last week as the mills were on the sidelines on expectations that the rates may come down more following the arrival of phutti.

In ready business phutti prises fell in Punjab to Rs 1600 and in Sindh the rate was at Rs 1700. Cotton analysts said the cost of production turned higher after the rise in the oil prices and other factor is contamination, which caused fall in the textile goods export. Now the fact is that the ginners may try to make deals at the lower rates of fine types as prices showed softness last week. The following deals were reported as some 200 bales from Burawala sold at Rs 3900 and 100 bales from Arif Wala sold at Rs 3800, they said.

===========================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
-----------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================
Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
===========================================================
37.32 Kgs 3,750.00 50 3,800.00
Equivalent-------------------------------------------------
40 Kgs 4,019.00 50 4,069.00
===========================================================

 

[rakeshmalik]

cotton report

Once upon a time, long ago, cotton marketing was the same year after year. As government controls began to come off in the late 1960’s and early 1970’s there were only minor changes, as one could stay in New York and peg the market for the full year. By 1977, if one wanted to get an understanding of the coming year’s cotton market they had to look at commodity price ratios, take a trip to Memphis, talk via telephone one or two Texas cotton merchants, nothing else. There was almost no mention of demand—year after year. Then by the late 1980’s, with globalization in its infancy, and the demand side of the price equation becoming important, both commodity price ratios and technicals (charts and graphs) drew additional attention. Globalization was the key word of the 1990’s as the U.S. cotton industry came to realize that world events, both political and economic, had a direct influence on the cotton market. With globalization just being understood, the 2000’s gave the market a full shot of billion dollar fund managers with pension funds and individual state retirement funds being sunk in to commodity trading, with cotton getting its fare share. These managers call it “investing.” Whoever heard of the futures contract referred to as an investment? Now, there are billions “invested” in cotton speculation, as well as all other commodity futures markets.

The crux of all this: Not only is each year different, today’s cotton market is different from the prior day’s market. Every morning brings a new set of fundamentals that impact the market. Stability one day is followed by a limit move the next. Once volatility seems to decline, it skyrockets the next; day after each day is a new beginning. Therefore, marketing is more important than ever before, simply because of the price volatility the seen almost daily. Fortunately for growers, as volatile as the market is today, it is in a “resting” period waiting for the blow off that will come later in 2008 or in 2009 as the world’s inventory of cotton declines and more and more land area is devoted feed crops, food crops and oilseeds.

On Monday, June 30, USDA will release its June Plantings Report. In March growers indicated their intentions to plant about 9.5 million acres. However, actual plantings have fallen possibly as low as 8.4 million acres. Expect the range to be between 8.4 and 9.0 million acres, with a bias to the low side. Watch for any “clarification” from USDA in the report. Since the report is “officially” a planted acreage report, any plantings that have already been abandoned will still be counted in the report. Thus, the guessing game is already in process with respect to how much acreage has already been abandoned. Is it 500,000 acres or is it 1.5 million acres? Will the crop be 12.0 million bales or 12.5 million?

U.S. export sales for the ending June 19, 2008 totaled only 29,000 RB, a marketing year low. Upland sales were only 19,100 RB. Pima sales were 9,900 RB. Indonesia (9,200 RB); Vietnam and Thailand were the primary buyers of Upland. United Arab Emirates (3,200 RB); Japan and India were the primary buyers of Pima. It is evident from the last two weekly export reports that the market has left demand behind. The only sales have been for immediate needs only. Too, while prices are subject to another slip, they will fall only marginally below 70 cents, if that much. The current pace of shipments suggests that USDA will have to lower its 13.9 million bale export estimate 200,000 bales, down to 13.7 million. Weekly export shipments totaled only 286,600 RB. Upland shipments accounted for 282,200 RB. Pima shipments were 4,400 RB. Primary destinations for Upland were China (95,400 RB); Turkey and Mexico. The primary destinations for Pima shipments were Indonesia (1,900 RB); Japan and India.

Domestic consumption continues to wane as U.S. textile mills used cotton during May at the annualized rate of 4.5 million bales. The annualized usage during April was revised 100,000 bales lower, down to 4.6 million. Annualized consumption during the first nine months of the 2007-08 marketing year stands at 4.5 million bales. The current USDA projection for the marketing year is 4.6 million bales and will likely be lowered 100,000 bales, down to 4.5 million. USDA current forecasts 2008-09 domestic usage at 4.3 million bales. The 2006-07 usage, just a year ago, was 4.8 million bales. Thus, domestic cotton consumption in the U.S. is losing an average of 250,000 bales a year.

The USDA report could well be the impetus that pushes December to near 85 cents. Additionally, the soaked and flooded corn-belt will push corn and soybeans higher. Corn is looking more and more like a $7.00 market given this season’s production problems. Cotton will have to follow suit to maintain planted acreage just at 8.5 million acres in 2009. Volatility, volatility and more volatility...

 

[rakeshmalik]

New York cotton futures decline
NEW YORK (July 02 2008): Cotton futures were pounded by investment fund sales to finish Tuesday at a three-week low, but consumer buying may come in and blunt fibre contract losses this week, brokers said. The key December cotton contract fell 2.29 cents to finish at 76.33 cents per lb, dealing from 75.53 to 79 cents. Based on the third position closing charts, it was the lowest close for cotton since June 10.

Spot July cotton slid 2.62 cents to close at 68.78 cents. Volume traded in the December contract stood at 20,319 lots at 2:41 pm EDT (1841 GMT). Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia, said that based on the way the market wound up, fibre contracts may lean lower but that mill buying may show up overnight and stabilise the market.

Johnson added that automatic programmed orders at the end of and the beginning of a month likely added to the pressure felt by cotton contracts. Fundamentally, the market has already digested the US Agriculture Department's annual planted acreage report on Monday. USDA showed US 2008 cotton plantings at 9.246 million acres, down from 9.39 million it estimated in March and trade belief it would range from 8.45 and 9.2 million acres.

Johnson and other analysts said there were also lingering jitters over the impact ever-escalating crude prices will have on world cotton consumption. Analysts are now content to monitor cotton growing conditions in the US cotton belt. Most market sources said the actual amount planted to cotton by US farmers is much lower than the USDA estimate.

They said Texas, the top growing state where half of all American cotton is sown this year, may see more losses after howling wind, heat and dry conditions stressed the plants in the area. Investment fund sales kept market under pressure throughout the session, traders said.

Brokers Flanagan Trading Corp sees support in the December contract at 76 cents, with resistance at 76.85 and 77.60 cents. Volume traded Monday hit 15,543 lots, exchange data showed. Open interest in the cotton market fell 453 lots to 215,451 lots as of June 30, exchange data showed.
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Spot rate cut by Rs 50, rains delay phutti arrival
RECORDER REPORT
KARACHI (July 02 2008): The arrival of phutti came down after rains in most part of Punjab, dealers said on the cotton market on Tuesday. The Karachi Cotton Association (KCA) official spot rate was lower by Rs 50 to Rs 3700, dealers said. The seedcotton prices were at Rs 1550-1650 and in Sindh rate of phutti was at Rs 1700, they said.

Cottonseed was trading at Rs 730. Commenting on the dullness in the cotton business they said that despite the sizeable arrival of phutti, mills were sidelined due to higher rates of gas and electricity charges. Besides, rates of other inputs are also going up as a result of soaring prices of oil in the international market, they said. The investors are losing confidence due to persistent uncertainty on both the political and economic fronts, they said.

The ginners were jittery over the prevailing trend in the market as they have still unsold stock. On Monday, the New York cotton futures crumbled from investment fund sales to end lower as the key December cotton contract sank 2.78 cents to conclude at 78.62 cents per lb, dealing from 78.50 to 81.53 cents. Spot July cotton slid 2.01 cents to close at 71.40 cents, dealing from 70.81 to 73 cents. Volume in the December contract stood at 13,551 lots at 2:38 pm EDT (1838 GMT). The only deal reported was some 100 bales from Hyderabad sold at Rs 3800, they said.

===========================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
-----------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================
Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
===========================================================
37.32 Kgs 3,700.00 50 3,750.00
Equivalent-------------------------------------------------
40 Kgs 3,965.00 50 4,015.00
===========================================================

 

[rakeshmalik]

Indian cotton prices rise on tight domestic supply
2 Jul 2008 5:03 pm

Mumbai - Cotton prices in India continued to move higher in the week ended Wednesday on tight supply in local markets.

The price of Shanker-6 grade was quoted at Rs 28,000 a candy compared with Rs 27,000/candy last week. One candy is equivalent to 355.62 kilograms.

Prices are expected to rise further to Rs 29,000/candy before the close of the current crop year ending Sept. 30, said traders.

Carryover stocks as of Sept. 30 are expected to total 4.3 million bales, less than the 6.0 million bales necessary to ensure that cotton prices remain competitive.

"The situation of low stocks has arisen because of an unprecedented rise in exports this year," said a Mumbai-based trader.

According to government estimates, India is projected to export 8.5 million bales in the marketing year ending Sept. 30, up from 5.8 million bales the previous year.

"Some project exports to be higher than the government estimates by another 1.0 million tons," said the Mumbai-based trader.

According to industry officials, exporters have already contracted to sell 500,000 bales of the new crop in November-December at high prices.

Meanwhile, sowing of the new crop is complete in the northern Indian provinces, as most of the area is irrigated, while sowing in Maharashtra, the main producer in the country, has begun with the onset of rains in the province.

Cotton planting has picked up from the previous week and is a tad down from last year's planting at 1.51 million hectares as of June 27.

India's cotton production during the coming crop year starting October is expected to rise 3% to 32.5 million bales.

In India, the cotton crop is sown in June-July, while the harvest starts around October.

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Cotton lint slides on small correction
2 Jul 2008 2:39 pm




Abohar - Cotton lint slipped Rs 10-Rs 15/maund on slight correction in prices at major markets across north India Wednesday. Sharp decline in international market and the rumours of ban on cotton exports from the country are making the domestic market a bit weaker.

Across Punjab, cotton lint traded at Rs 2,890-Rs 2,899/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,890-Rs 2,899/maund at Malot and Gidarbha; Rs 2,870-Rs 2,8875/maund at Abohar; Rs 2,870-Rs 2,875/maund at Manasa; and at Rs 2,910-Rs 2,915/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,850-Rs 2,900/maund in Haryana and at Rs 2,650-Rs 2,750/maund in Rajasthan

 

[rakeshmalik]

Easy tone observed on cotton market

KARACHI (July 03 2008): Smooth arrival of phutti pushed the prices down on the cotton market on Wednesday, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3,700, they said. Phutti prices in Punjab were lower at Rs 1,400-1,500 and in Sindh at Rs 1,650-1,700, dealers added.

Some brokers said that arrival of phutti was good. Sharp rises in gas rates made the textile sector jittery as a result leading mills were on the sidelines. This factor may bring down phutti prices further, dealers said. A ginning factory has started operation in Shahdadpur, reports said.

THE FOLLOWING DEALS WERE REPORTED: 1,872 bales from Khanpur sold at Rs 3,700, 200 bales from Pakpattan, same figure from Arifwala and equal figure from Haroonabad done at the same rate.

===========================================================
The KCA Official Spot Rate for Local Dealings in Pak Rupees
-----------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
===========================================================
Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
===========================================================
37.32 Kgs 3,700.00 50 3,750.00
Equivalent-------------------------------------------------
40 Kgs 3,965.00 50 4,015.00
===========================================================

 

[rakeshmalik]

Small decline seen in 2008-09 global cotton production: ICAC
3 Jul 2008 10:05 am

New York - World cotton production is expected to decline 3 per cent to 25.5 million tons in 2008-09, according to data released this week by the International Cotton Advisory Committee.

The ICAC sees a major production drop in the US, while smaller declines are expected in China, Brazil, Egypt, Turkey and Central Asia. Production increases are projected in India, Australia, the African Franc Zone and Pakistan.

Global cotton mill use is expected to decline by 1 per cent in 2008-09 to 26.6 million tons, due to projected slower global economic expansion and higher prices of cotton relative to polyester.

World cotton stocks are forecast to decrease by more than one million tons to 11.0 million tons in 2008-09. The largest decline in stocks is expected to occur in the US, where considerable supplies that accumulated during the previous two seasons will fuel exports, the ICAC said.

The season-average Cotlook A Index is expected to rise from 73 cents per pound in 2007-08 to 82 cents per pound in 2008-09, it said