Cotton

[rakeshmalik]

PCGA to continue strike

MULTAN (August 09 2008): Pakistan Cotton Ginners Association Chairman Muhammad Akram has announced to continue their strike till acceptance of their "genuine demands". Addressing a press conference along with circle vice chairmen on Friday he said that a delegation of PCGA would call on Textile Secretary on August 9 in Islamabad. After that, fresh strategy would be announced.

He said that the delegation would also meet FBR Chairman of on August 12 to settle the dispute of refundable taxes. He said that Punjab Government had arranged a meeting with provincial Secretaries Excise & Taxation, Agriculture and Secretary Textile but Secretary Textile did not join the meeting and this arrangement proved a futile exercise.

He further said that a two-member delegation of PCGA, comprising Saeed Ahmed and Mehmood Ahmed, apprised the FPCCI of their grievances. Upon this, the Advisor to Prime Minister Manzoor Wattoo asked them to call off the strike and he would resolve their problems. But ginners are not in a position to run their factories in the absence of working licence.

He called upon the politicians like Javed Hashmi, Shah Mehmood Qureshi, Zulfikar Ali Khosa, Tehmina Daultana and heads of coalition partners to come forward to help the ginners and cotton growers. They also asked Prime Minister Yousaf Raza Gilani to intervene in the situation. The PCGA chairman said that ginners and growers would jointly organise demonstrations at district headquarters to draw attention of the rulers towards their problems.

Banners were being displayed at all big cities containing their demands.. He said that Textile Commissioner and Provincial Secretary Agriculture Javed Iqbal had invited a delegation of PCGA for dialogue. He was ready to extend the working licence for next two months but he was not authorised to waive the standardisation fee @ Rs 5 per bale.

Thus these dialogues could not prove fruitful. The PCGA chairman said,"Our strike would continue for indefinite period to press the authorities for changing their behaviour and acceptance of their demands".

He said: "Our business remained close as a protest against the levy of extra taxes and depriving of all facilities as promised in an agreement between the Government and PCGA in 1991-92." He said that cotton production was declining season by season and this year cotton worth one billion dollars would have to be imported from different countries to run the textile industry.

He said: "We did not make the strike decision in a haphazard way and we were forced to take this harsh decision because Agriculture Department refused to issue working licence to ginneries without clearance of disputed dues.

It was decided at a general body meeting on July 28 to observe complete strike from August 1 as the government departments and bureaucracy had treated them step-motherly and put hurdle in their way and did not resolve their problems. PCGA was unanimous on the issues of non-payment of standardisation fee @ Rs 5 per bale, Workers Welfare Fund, and withholding tax.

Akram said that FBR should not impose refundable tax on the ginners and similar facilities be given to them as are permissible for textile mills. He said that the government should end the 'Clean Cotton' programme which is a discriminatory way to oblige a particular class of ginners and depriving 1100 ginners of this facility-simplification of procedure of issuance of working licence and removing hurdles in this way, declaring the cotton ginning industry as zero-rated industry, enrolment of ginners in Federal Board of Revenue and e-filing of returns of sales tax, withdrawal of increase in sales tax, resolving the issue of Workers Welfare Fund, ensuring the uninterrupted power supply for 18 hours.

He said that elections of PCGA would be held in March 2009 but it would be subject to the approval of Director General Trade Organisation. He said that Government should not issue working licence to non-members of PCGA and membership of PCGA should be mandatory for the issuance of licences.

 

[rakeshmalik]

Cotton prices turn bearish due to widespread rains

KARACHI (August 11 2008): Monsoon rains have well set in and widespread rains with normal to heavy intensity have poured on cotton belts of Central Punjab and Southern Punjab. Sky generally remains overcast with clouds. Heavy rains followed by floods are reported to have damaged cotton crop in Dera Ghazi Khan, Rajan Pur and Fazil Pur cotton belt.

Sindh also received rains and another spell is expected in the month of August. Last fortnight rains generally cotton crop generally in whole of Sindh but specially in middle and Upper Sindh areas where crop is in boll-formation stage.

As a result of decrease in seed-cotton arrivals, more than half-ginning factories have been closed down temporarily till such time adequate supply is restored. Apparently, recent rains have washed out some of the sucking pests thus improving the general health of cotton plants.

In Sindh about 10-12 ginning factories are in operation and more would resume operation as seed-cotton arrivals increase. The token strike of the ginners has been called off reportedly on the assurance of the Ministry of Food, Agriculture and Livestock (Minfal) for acceptance of their demands.

Most of the cotton institutions like, Pakistan Cotton Standards Institute (PCSI), Pakistan Central Cotton Committee (PCCC), Pakistan Cotton Ginners' Association (PCGA) and the Karachi Cotton Association (KCA) are working only the on low level and apparently are not contributing anything concrete towards promotion and development of cotton.

The PCSI has established latest cotton fibre testing labs equipped with latest HVI (High Volume Instrument) machines at 11 places; 4 in Sindh viz: Karachi, Sukkur, Sanghar and Mirpur Khas and 7 places in Punjab viz: Multan, Vehari, Bahawalpur, Sahiwal, Faisalabad, Dera Ghazi Khan and Rahimyar Khan, covering all cotton areas in Punjab and Sindh provinces. Present cost of one HVI machine may be around Rs 15 millions. All the lab stations are working under capacity; hardly 20 percent of their capacity. PCSI has about 120 well-trained and experienced technical officers with total staff around 180 persons. Practically, they are without work and are sitting idle. The new government is requested to look into the affairs of PCSI and decide its fate; whether it should be given work or it should be closed down.

Second phase of timely rains in India's Central zone consisting of Gujarat, Maharastra and Madhya Pradesh States have brightened prospects of a bumper crop. It is interesting to note that in 2007-08 only one Indian State of Gujarat produced cotton more than Pakistan's total production and Gujarat's popular cotton variety Shaker-6 remains in high demand in international market.

In the words of D. K. Nair, Secretary General, Confederation of Indian Textile Industry (CITI), India exports more than 80 percent of its raw cotton to China and Pakistan which its toughest competitors in exports of textile goods. He says when we export cotton to them we are exporting textile jobs and when we are importing textile goods from these countries, we are importing unemployment.

In 2007-08, India is reported to have made export sales of about 10 million 170-Kg bales against its exports of 5.8 million bales last season. As a result of overselling in exports, Indian mills are starving of raw cotton and are now importing cotton and the Textile Commissioner has now been entrusted with job of registration of export contracts to regulate exports of raw cotton.

While cotton remains in the hands of growers, cotton prices remain depressed and after selling to ginners or traders the prices start picking up, befitting the ginners and traders against the interests of the growers. The same trend is seen in Pakistan. In India, the government is considering the scheme of fixing of minimum support price to ensure payment of fixed price to safeguard growers interests.

Lint cotton prices in local market though maintained a steady trend but in last two working days of the week prices turned to be bearish on reports increased arrivals and week NY advices. Globally, prices of commodities such as gold, food-grains, edible oil and crude oil are decreasing and so the cotton prices. Ruling lint prices after touching the highest of the season at Rs 4,300 per maund of 37.324 Kg ex-gin, have come down to Rs 4,000 for 25th August delivery otherwise ready delivery at Rs 4,100 - 4,175 / Maund ex-gin. Pak Rupee is week against US dollar and is quoted around the level of plus Rs 72.0. The FOB price works out to US Cents 74.25/lb.

The recent down trend in New York cotton prices and quotation of December contract at below the level of 70 would make cotton imports viable and the spinning mills would go for imports pending local purchases. The volatility of economic, political and law and order situation in the country does not lend a helping hand in maintaining stability in prices. However, cotton prices in domestic market may be influenced by possible wide fluctuations in prices on reports of crop position, edible oil prices, local political, economic instability and NY cotton advices. The lower limit for lint cotton may be Rs 3,800 by end September.

 

[rakeshmalik]

Rates start easing on cotton market after ginners' strike hurdle removal

KARACHI (August 11 2008): At the start of the week the lint rising prices were causing hurdle in normal buy when ginners acted on their threat to rationalise gas and oil prices besides doing away with certain additional charges they were refusing to pay, brought trading to almost total halt.

The spot rate was at Rs 4150, while rate in ready on the first session was marked at Rs 4250, as normal trading activity was missing. But scenario changed with the ginners calling of the strike on acceptance of their demands. The spot rate, which was raised to Rs4250 brought back to Rs4150 and lint prices eased to Rs4075-4175 range from the peak of Rs 4300, on closing of the week on August 9,2008.WORLD SCENARIO

As investment fund's continued liquidation did not stop, brought prices down to 11-month low. The other commodities, too, aided cotton retreat. The players observed cotton was so easily being swayed by outside markets. The threat to Texas cotton crop from tropical storm Edouard did not impact the trading. Low wind was welcome for the crop, while any turn to hurricane will lead to thrashing and firming up prices. The December contract retread 2.76 cents to 69.13 cents to a pound.

On Tuesday slight downturn was marked as speculative short covering interest was noted petered out. The contracts dipped to 69 or like amount. The storm had threatened to create some trouble in the Texas cotton growing areas, but latest report show it had considerably weakened. Instead, it will offer relief, players hoped. However they brace for receiving nearly 17- out of it 9 likely to be bothersome. They are also interested in August 12, release of supply/demand likely to furnish first detailed look at the crop during 2008-09 season.

On Wednesday futures rose as prices extended a phase of consolidation near the 69-cent level with players eyed on supply/demand report next week. Meanwhile the trading likely in the present range to take a shape when data would give the first detailed look at various crops. Long term fundamentals are considered favourable due to lower ending stocks and reports about low acreage being planned world over.

On Thursday the NY cotton futures ended up over two percent extending a bounce from Tuesday's 11-month low below 69 cents a lb on options-related buying and outside market strength. Cotton for December delivery settled up 1.82 cents, or 2.6 percent, at 71.38 cents per lb. The session range spanned from 69.56 to 71.43 cents.

On Friday the NY cotton futures lost more than three percent by the close, caught up in broad-based commodity sell-off stemming from a US dollar rally. Cotton for December delivery closed down 2.21 cents, or 3.1 percent, at 69.17 cents per lb. The session range spanned from 69.05 to 71.30 cents.

Volume traded in the December contract hit 9,358 lots by 2:49 pm EDT (1849 GMT).

LOCAL TRADING:

The prices were hurdle in the way of large scale lifting until late last week (August 1) that ginners strike put further end to it. Phutti supply and ginning of cotton completely stopped in nearly 800 units out of more or less 1200 ginneries. The ginners are last of those, who resorted to not only threat of action, but closed down mills on Friday.

The spot rate was put at Rs 4150 on Monday and 200 bales solo deal strick was seen at Rs 4250. The market sources were expressing surprise at the dull conditions such, as ones are being observe will add to cost of production further. The imported cotton will ease situation seems next to impossible.

On Tuesday with the background bullish development was signalling the spot rate rose further by Rs 50 to Rs 4200, said to be short supply of phutti owing mainly to ginning units remain closed due to announced strike to reach their grievances that hurt their interest.

However, phutti in Sindh was reported down offered at Rs 1700 and 1750. Punjab did not see any sale of phutti and cotton, naturally. Nearly 1000 bales of cotton changed hands, in small lots, priced at Rs 4250 to Rs 4300. Meanwhile, rains causing harms to life and property was seen beneficial to cotton crop. There was no news on strike from any quarter, while cotton prices leap higher.

On Wednesday spinners and miller in a fix picked up some 2000 bales under uncertain near term development as ginners' strike continued, phutti suppliers on ginneries door step awaiting to deliver. The ready prices were seen between Rs 4150 and Rs 4200 more or less. Meanwhile, there is sketchy news about monsoon rains that are said to be good for cotton crop, spot rate was unchanged at Rs 4200.

On Thursday Higher trend was seen. The official spot rate again raised by Rs 50 to Rs 4250 amid strong demand. In the ready business, the phutti prices in Punjab were at Rs 2000-2025 and in Sindh at Rs 1850-1950. Ginners' strike caused sluggish business and rising trend in the prices. Phutti arrivals were continue with slow pace as recent rains are favourable for the crop but if the rains continued for a long time, may damage the standing crop. Some 1100 bales of cotton changed hands within the price range of Rs4225-4300.

On Friday, easier trend was seen on the cotton market amid expectations that the ginners' strike may end after the ginners' meeting with the Chairman of the Federal Board of Revenue and the textile secretary.

The official spot rate was kept unchanged at Rs 4250. In the ready business phutti prices in Punjab were at Rs 1950-2000 and in Sindh, at Rs 1800-1850. Market sources said that the phutti arrival continues and the ginners, who have unsold stock, are trying to sell them due to attractive rates. In the meantime, after the rains in cotton belt, the mealy bug has become a serious threat to the crops including cotton. "The pest has the potential to destroy crops if not managed properly," says a release issued by media liaison unit (MLU) of agriculture directorate Multan. According to an Australian cotton broker, the world cotton prices could gain 20 percent or more during the next 12 months and also causing an attraction for the farmers as they may switch away from planting other crops.

Some 1400 bales of cotton were bought and sold at Rs 4175-4275. On Saturday, amid hopes of better production and end of ginners' strike KCA was able to pull the official spot rate down by Rs 100 to Rs 4150. Around 8800 bales of cotton changed hands within the price range of Rs4075-4175.

GINNERS STRIKE:

Whether or not this unfortunate thing should have been come to pass, is to be judged by those who have done and those, who are in know of thing. The ginners had been showing their inability to pay Research Cess imposed by textile ministry in 2006. The PCGA is stated to have never paid, except however, few. The ginners have never given valid reason except advancing inconvenience in payment. For two year they were working without honouring it and perhaps was linked the payment of research Rs 5 perbale with renewal of working licence, which ended on July 30, 2008 and dead line PCGA had threatened to close working of more or less 1000 mills.

That fateful day came on Friday. The ginners claim that they had not seen any move from the authorities whether some solution was likely, meaning decision was firm on both sides. Now, the 2008-09 season has just been in slow or fast seed-cotton arrival is on. How long the tug of war continues will depend on solution or at least efforts to solve the problem. On international scale, according to reports production was likely to be low as subsidies are being lowered and other crops ensuring better return. Today textile products' exports are backbone of economy.

Under the circumstances any body could see bad days are ahead. When all was nearly, repeat, smooth the government had to import cotton at the cost of rupees one billion. The strike, that is to be indefinite, can make things worse. A report recently carried good news that government earned rupees one billion worth through exports. But cotton exports can block exports of textile products, which earns maximum forex, employs maximum number of unemployed, such qualities could hardly by ignored.

AS MANY ORGANISATION, AS MAY VOICES:

A year back the names of two/three associations appeared in newspaper reports suggesting or demanding something to improve either quality of the products or edge in marketing. Today, since the slogan touched the sky high-cost of doing business with smaller gaps associations started sprawling with hardly wide apart voices.

The most sought after demand was by all and sundry for continuing or at time enhancing the value of R&D (research and development) subsidy. The previous government under very pressing conditions had coined under cover subsidy to avoid objections for outright package of billions of rupees. The out went government had never even dreamt, had not seen R&D will be so much attractive to take shape of never ending sort. If memory is working six percent to three percent or like amount was provided to improve forex earning and be just a matter of past.

But it was not to happen as the authorities in the previous government had thought, the voice would not follow, rather exports will be made a matter of life and death. The exports have not reached the size of target $14 billion or like amount but various demands in different shapes continued to trumpet high in the atmosphere.

Sometime back gas and oil rates rise was exceptionally hurting experience and to some ST was a block in smother exports. The apparel forum, which has never claimed to have done booming business but had often contested, given patronage and facilitating where requisite, they were not lagging far behind with other textile products.

Their claim to fetch most per unit indeed was very true. Now that lately come in the picture apparel forum requisition to exempt ST from packing material of textile sector could be favourably considered subject to authorities thinking in similar veins. Their claim the authorities must be aware of is that their cost of doing business has gone 12 percent high as their claim compared with other countries exporting similar products.

WILL POOR GAIN FROM WTO?

The apprehensions that were expressed that rich will show they are trying to squeeze out as much riches as possible but then they will stop that to press poor through emerging developing countries to force more ground ultimately. Before July 2008 meeting actually had opened on its eve much hope was being expressed that a deal was on the anvil. Those who had reservations however, stuck to their stance rich can part anything as a "charity" and not as shares two partners part with.

The world population or countries were bisected in three major segments - developed countries, emerging developing countries and Least Developed countries. The least developed few countries were ultimately to make escape goat at the final end saying poor will lose much by ignoring deal than the rich.

Quite true, rich has not one way to cover through science, education, natural resources, information technology and correct understanding of the problems and means to get at them.

Poor has nothing except raw material, which is that for rich philanthropists chalked out so big looking a thing like WTO. The raw goods rich buy at one or two cents sell after adding value to then one dollar / on pound sterling, in doubt why they have ruled a number of world scale organisations in the way they wanted claiming as the leader of democracy.

Quite a few years back Brazil was moved giving it a status of emerging developing country, through India with same status was kept in reserve. China is leader among the developing countries she was put at the sidelines understanding China won't be easy job to bring it to their toes. The yuan, the Chinese currency, which has been a headache to so-called developed countries, gave insight for thrashing out bunchy matter.

China is a different sort. However, it was very much in sight to sources, who often had indicated India may ultimately considered to come to terms because WTO was supposed to have huge offers in its coffers. The headline vibrated relief as it said on front page on July 1, 2008, "India willing to rejoin WTO talks but won't compromise on farmers who every day die in that country despite nice cooked food thrown in the backyard of five star hotels world over.

BUYERS HESITANT NATURALLY:

The fact that exporters and manufacturers should mind more for their responsibilities than depending wholesale on government help-be it fabrics or foot, said sources who appreciate exporters genuine problems should be looked into and resolved. But at the same time they think government's coffers are hardly ever have been so full blooded in Pakistan to stay, as such after tax exemption duty cut and favouritism.

The last word embraces everything that has kept projects development a begging. If such is the condition of state, the prevailing self-deception all four sides, sector like exports can flourish is unthinkable. If state sector like business and export form parts of state all equally have to contribute rather than looking for state help day in and day out.

All four will have to change the perception more so as something topsy-turvy seems to have been taken root during the six decades. Unless Pakistanis don't change the perception how can exports products from Pakistan be reasonably priced and readily acceptable?

To the sources, who commented on the state of things above, was no surprise that buyers were full of reservations and particularly they looked at price differently. The exporters of textile products or any products has tacitly named China, India and Bangladesh products can be ordered for X'mas shopping ignoring products worth $78 million whose fate is hanging in balance owing to price, which in the absence of research and development subsidy had lost edge over the regional rivals. The victims have been approaching authorities directly and indirectly, the sources felt they are not able to suggest either way. So, they said they will rather wait and see whether exporters have been favoured.

HACKNEYED DETERMINATION:

Had there been no trade off on revenue collection at least, economy would be booming, and certainly not in so much distress. No trade of like phrases and sentences can be found littered in newspapers but those who really felt such favours were running this eternally poor country, shape of the country would be different. Very recently federal finance minister sounded the feeling much to the disgust, rather than cheering, the sources close to textile trade commented on the report, which carries whit it the heart throbs of Pakistan who have sacrificed, willy-nilly though, development projects, health, education and two square meals for liberal trade-offs.

Much can be salvaged, if even right now down what is said. The time has come to such a passe, a hard working farmer Nawab Khalid with tears in his eyes said government has always been behaving like a silent spectator in recent case of hoarding of sugar, wheat, pesticides or fertiliser loud action was announced but nothing came to surface".

During 2007-08 season mealy bug attack was reported, while the pesticides were either not on offer or it that were 10 to 100 times cost - sources reminded. And the fellow who wanted to produce the drug locally was shuddered to see the way available drugs were treated. The textile products are getting dearer in foreign markets. Even friends like European Union and the US have been keeping their importers away.

The recent PM visit - was expected to produce a lot of goodwill and investment and FTAs etc but what is being received from those was all sorts of misgiving and indication of undesirable stuff. May be PM has to announce what has not been coming during his absence. But reports, one such quoted above, await for solution on his return. May be the tons of textile products stated sometime back to be stuck up have been accepted by importers and money paid.

 

[rakeshmalik]

'Coming month crucial for cotton industry'

MULTAN (August 12 2008): Engineer Javed Saleem Qureshi has said that the Pakistan Cotton Ginners Association (PCGA) has taken a good step by calling off their strike over the last few days. He said that farmers were already being exploited and this strike further added to their sufferings.

While talking to Business Recorder, Qureshi said that this year the environmental conditions for the cotton crops are favourable and a good cotton crop is expected this season. He said that although cotton is cultivated on 20 percent less area this season, it won't matter.

He warned farmers that the attack of pests after rains increases so they should take adequate measures to save their crops from attack by pests. The ratio of spray in southern Punjab remained 12 percent less this time he added. In response to another question, Qureshi said that due to the Olympics, pesticides couldn't reach the country on time, which resulted in an increase of pesticides prices by 15 to 20 percent. He said that field staff should go out to the fields to guide farmers.

The engineer said that it was alarming that Pakistan was not achieving its target of cotton for the last three years. He said that the upcoming month is very important to prepare a strategy to obtain better production of cotton and save it from the attack of pests.

 

[rakeshmalik]

Spot rate lowered by Rs 100 on cotton market

KARACHI (August 12 2008): Falling trend persisted on the cotton market on Monday as leading mills and spinners kept on the sidelines due to persistent uncertainties on the political front, dealers said. The official spot rate continued weekend decline, lowered by Rs 100 to Rs 4050, they said.

In the ready business, phutti prices moved up modestly in Punjab at Rs 1900-2000 and in Sindh, phutti was trading at Rs 1850-19000, they added. Market sources said that wait-and-see condition prevailed on the market as most the spinners were on the sidelines to observe the development in the political arena.

The political instability in the country is causing erosion rupee value discouraging investment by the local and foreign investors as well, they said. Meanwhile, some mills made buying at their psychological levels, they said adding that the ginners were also trying to sell their unsold stock for better rate. It is expected that the rising trend in the phutti arrivals may cause decline in the rates, they said.

 

[rakeshmalik]

Cotton lint insensitive in west India
12 Aug 2008 2:25 pm

Mumbai - Cotton lint prices remained stable at major spot market across western India Tuesday. Millers are avoiding fresh buying amid improvement in crop situation and reports of heavy imports.

At Kadi market in Gujarat, cotton lint S-6 A-grade was quoted at Rs 27,000-Rs 27,700/candy while average-grade traded at Rs 26,800-Rs 27,200/candy.

In Maharashtra, the 28MM cotton lint traded at Rs 27,400-Rs 27,700/candy; 29MM cotton lint traded at Rs 27,800-Rs 28,000/candy; while 30+MM cotton lint traded at Rs 28,200-Rs 28,500/candy; and 31+MM cotton lint traded at Rs 28,700-Rs 29,000/candy.

At Sendhwa market in Madhya Pradesh, the 28MM cotton lint traded at Rs 27,300-Rs 27,500/candy; 29/30MM cotton lint traded at Rs 27,600-Rs 28,000/candy; and 31MM cotton lint at Rs 28,100-Rs 28,300/candy; and DCH variety traded at Rs 31,000-Rs 32,000/candy.

 

[rakeshmalik]

Cotton lint slips little in north India
12 Aug 2008 2:28 pm

Abohar – Cotton lint prices dropped marginally by Rs 5-Rs 10/maund amid absence of buyers at major markets across north India Tuesday. Millers are not making deals at the current higher rates. The market is witnessing pressure amid improvement in sowing and the condition of standing crop after the recent good rains across the country.

In Punjab, cotton lint traded at Rs 2,790-Rs 2,810/maund at Budhaldha, Taapa and Rampura; Rs 2,780-Rs 2,790/maund at Malot and Bathinda; Rs 2,770-Rs 2,780/maund at Abohar; and Rs 2,760-Rs 2,765/maund at Manasa.

Cotton lint traded at Rs 2,715-Rs 2,775/maund in Haryana and at Rs 2,630-Rs 2,715/maund in Rajasthan.

New crop October full delivery was quoted at Rs 2,560-Rs 2,590/maund in Punjab and at Rs 2,540-Rs 2,570/maund in Haryana.

 

[rakeshmalik]

ICE cotton slips in thin trade
12 Aug 2008 10:38 am

New York - ICE Futures US cotton posted losses Monday as position squaring ahead of Tuesday's US Department of Agriculture report pulled futures below support levels in late trade.

Most-active December futures settled 43 points lower at 68.74 cents a pound, and the nearby October contract settled down 53 points at 66.72.

December cotton opened slightly lower and traded in light volume near unchanged. The contract climbed to the 69.50-session high and abruptly fell back, scraping 69-cent support and trimming some losses. From that point, the market crept lower and slid to the session low at 68.54 basis December. Futures trimmed some losses ahead of the settlement but closed lower on the day.

Traders evened up positions in last-minute nervousness ahead of the USDA crop production and supply and demand reports, said John Flanagan, president of Flanagan Trading Corp. in Fuquay-Varina, N.C. The reports are scheduled to be released at 8:30 a.m. EDT (12:30 GMT) Thursday.

Analysts expect the USDA to slightly raise US 2008-09 cotton production estimates while lowering world production and consumption projections in the report. The report will have the first official estimate of US 2008-09 harvested acres and yield, as well as a revised planted acreage estimate. Additionally, world production, consumption and ending stocks are indicative of the cotton supply and demand situation that determines prices, analysts said.

The December close below 69 cents may be setting up the contract for a test of the 67-cent level, said Mike Stevens, analyst at SFS Futures in Mandeville, La.

ICE daily cotton stocks decreased by 44,588 480-pound bales Friday to total 1.67 million bales with 1,935 awaiting review, according to the exchange. Decertification orders totaled 45,877.

ICE cotton open interested decreased by 1,368 positions Friday to total 217,684, according to the exchange.

Volume was estimated 8,337 lots. In options, approximately 6,578 calls and 5,341 puts traded, according to exchange data.

Close Change Range
Oct 66.72 -53 pts 66.55-67.25
Dec 68.74 -43 pts 68.54-69.40
Mar 74.00 -36 pts 73.81-74.47

 

[rakeshmalik]

Pakistan gets 50,000 cotton bales orders from India
RIZWAN BHATTI
KARACHI (August 13 2008): Indian traders have finalised deal with Pakistani exporters to import 50,000 bales of cotton, sources said on Tuesday. They said that although India is a leading cotton exporting country, but at present it is facing over one million cotton bales shortage in the wake of excessive export of the commodity during last fiscal year.

At present, Pakistan is the cheapest and nearest exporter of cotton for India. Exporters here said that Pakistan is likely to capture more export orders from India during the next few weeks. However, it would depend on the weather in India and crop estimations.

They said that the deals with Indian traders have been finalised at 78-81 cents per pound and it is expected that the price would rise in case of more demand. First shipment to India was in June 2008 when 9,050 bales were exported at 78-80 cents per pound.
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Cotton spot rate raised by Rs 50 amid improved activity
RECORDER REPORT

KARACHI (August 13 2008): Strong mills' demand propelled the ginners to raise asking prices despite the continued phutti arrivals, dealers said on the cotton market on Tuesday. The official spot rate overnight weakness was changes for better, raised by Rs 50 to Rs 4100, they said. In the ready business, the phutti prices in Punjab was at Rs 1900 and in Sindh at Rs 1900-2000, they said.

Some brokers said that the rains in both Punjab and Sindh caused modest increase in the prices and it appears that the prices may move further higher in the near futures. There are fears that the mealy bug may attack the standing crop and may cause damage but presently it can't be guessed as to how much damage has been caused by the rains, they added.

The ginners again started increasing prices of lint and prices may rise in days to come, they said. On Monday the NY cotton futures finished slightly easier on follow-through investment sales and a higher dollar as the trade braced for release of a key government crop report, brokers said. Key December contract dropped 0.43 cent to finish at 68.74 cents per lb. Moved from 68.54 to 69.50 cents. Volume in December was 8,335 lots at 3:12 pm (1912 GMT).

THE FOLLOWING DEALS WERE REPORTED: some 2100 bales of cotton from Tando Adam at Rs 4090-4125, 1300 bales from Shahdadpur at Rs 4100, 400 bales from Hala at Rs 4100, 1000 bales from Sanghar at Rs 4100, 300 bales from Hyderabad at Rs 4100, 100 bales from Tando Jan Mohammad at Rs 4100, 200 bales from Sinjhoro at Rs 4100, 700 bales from Bhawalnagar at Rs 4125-4150, 400 bales from Burewala at Rs 4150-4200, 200 bnales from Qabula at Rs 4150, 400 bales from Pakpattan at Rs 4150 and 200 bales from Arifwala at Rs 4200, dealers said.

 

[rakeshmalik]

Steady trend, rising demand seen on cotton market


KARACHI (August 14 2008): Trading activity improved because of strong mills demand on the cotton market on Wednesday, dealers said. The official spot rate's upward trend was maintained by adding Rs 25 to Rs 4125, they said. In the ready business, the phutti prices in Sindh were at Rs 1900-1950 and in Punjab at Rs 1700-2100, they said.

According to the market sources, prices were steady as exporters and mills both were active to finalise the forward deals. It is expected that the rates may inch up as supply is not matching with the demand, they said. If rains continue in both Sindh and Punjab, the prices may push further higher and other factors such as the mealy bug and other farm diseases which may cause damage may intensify this trend, they said.

They said that despite opposition, the country has signed deals to export nearly 80,000 bales of cotton to the other countries. A leading international expert said that the world cotton prices are headed for a fundamental breakout to above 90 US cents a pound.

This would come as international production and stocks in the United States, the world's biggest exporter, shrank from more than 10 million bales last year to virtually disappear by 2010, said Ed Jernigan, managing director of FC Stone Asia.

On Tuesday, the NY cotton futures ended higher on fund buying after release of a bullish government crop report, but the lack of follow-through purchases and profit-taking pared the market's gains, brokers said.

The key December cotton contract climbed 0.89 cent to finish at 69.63 cents per lb. The contract moved from 68.72 to 71.74 cents. Volume traded in the December contract hit 11,298 lots at 2:46 pm EDT (1846 GMT).

THE FOLLOWING DEALS WERE REPORTED: some 200 bales of cotton from Arifwala sold at Rs 4250, 800 bales from Kabeerwala at Rs 4275, 200 bales from Sanghar at Rs 4125, 800 bales from Shahdadpur at Rs 4150, 200 bales from Tando Adam at the same rate, 400 bales from Mirpur Khas at Rs 4125-4140, 200 bales from Pakpattan at Rs 4150, 200 bales from Pir Mahal at Rs 4175, 400 bales from Gojra at Rs 4175-4200, same figure from Chichawatni at the same rate and 200 bales from Mongi bahal at Rs 4200, dealers said.