Cotton

[rakeshmalik]

Cotton prices hit new high; phutti arrival starts

KARACHI (June 25 2008): Cotton prices hit the new high at Rs 4200 on Tuesday as arrival of best quality of seed cotton was on rise, dealers said on the cotton market. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3800, dealers said.

As phutti arrival starts, the prices in Punjab were at Rs 2000-2200 and in Sindh the seed cotton was trading at Rs 1800-1850. Nearly 200 bales of cotton from Pakpattan sold at the record high price at Rs 4200, they said

Cotton production may be less this year as farmers or growers were interested to grow the crop, that is more profitable for them such as rice, some analysts said. This year, most of the commodity items tended higher especially, rice as many exporting countries banned the commodity to meet the shortage or control the prices locally, they said. But some of them have lifted the ban over the exports or thinking to grow more rice in their countries. Similarly, in Pakistan, cotton growers after facing shortage of irrigation water, are mulling to cultivate rice instead of cotton for better profit, they said.

It appeared that cotton business is on the losing side due to higher cost of production and partly because of textile products have failed in fetching the desired foreign exchange due to contamination problem and some other, as well. On Monday, NY cotton futures finished lower on investor sales and in line with weaker soybean values in Chicago, dealers said.

The key December cotton contract fell 0.71 cent to end at 79.40 cents per lb, dealing from 78.80 to 80.12 cents. Spot July cotton lost 0.79 cent to close at 70.88 cents, trading from 70.50 to 71.79 cents.

Volume traded in the December contract stood at 7,483 lots at 2:44 pm EDT (1844 GMT) while July volume amounted to 2,689 lots. Following deals were reported as some 400bales of cotton from Sultanabad sold at Rs 3700 and 4500 bales from Khanpur at Rs 3850, 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 3800.00 50 3850.00
-----------------------------------------------------------
Equivalent
-----------------------------------------------------------
40 Kgs 4072.00 50 4122.00
=========================================================

 

[rakeshmalik]

New York cotton futures remain lower

NEW YORK (June 25 2008): Cotton futures finished lower on Tuesday on investor sales and in line with weaker soybean values in Chicago, dealers said. The key December cotton contract rose 1.13 cents to end at 80.53 cents per lb, dealing from 79.60 to 81.36 cents.

Spot July cotton added 1.31 cents to close at 72.19 cents, trading from 71.03 to 72.80 cents. Volume in the December contract stood at 9,531 lots at 2:40 pm EDT (1840 GMT) while July volume amounted to 392 lots.

Traders said investor fund buying jacked up cotton futures throughout the session. "I think we chop around here until those numbers go out," said Keith Brown, president of commodity firm Keith Brown and Co in Moultrie, Georgia. Brown was referring to the US Agriculture Department's annual planted acreage report due for release on Monday, June 30.

Trade sources had said consulting firm Informa Economics forecast US 2008 cotton plantings at 8.935 million acres. Informa officials were not available to comment on their figure. In March, USDA forecast US cotton sowings in 2008 at 9.39 million acres. Most in the trade believe cotton plantings will range from 8.7 to 9.3 million acres.

Market mulling if USDA will include calculation on conditions in Texas, where half of US cotton will be planted this season. Cotton industry sources in Texas said the state could lose up to 1.5 million acres from weeks of blowing wind, hail and extreme heat. Trade took note of deliveries in July contract after open interest reached 2,434 lots as of Monday, June 23.

ICE Futures US said a total of 1,471 lots were delivered against the tape in the July contract. Traders said they see support in the December contract at 80.05 and 79.95 cents, with resistance at 81 cents. Volume traded Monday hit 14,361 lots, exchange data showed. Open interest in the cotton market sank 3,369 lots to 214,014 lots as of June 23, ICE Futures US said.

 

[rakeshmalik]

Solo deal in slow trade on cotton mark

KARACHI (June 26 2008): Thin trading was seen on the cotton market on Wednesday as most of the buyers kept on the sidelines due to higher rates, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 38000. Cottonseed was at Rs 950 per maund in Punjab, they said.

Phutti prices in Punjab were at Rs 2000-2100 and in Sindh the seedcotton was trading at Rs 1970, they said. Phutti started reaching at the ginneries but the rates are higher following the short crop anticipations, they said. But one thing is very confusing for the spinners and that is record rise in the prices of seedcotton and cottonseed.

It is just beginning of picking time and no body can guess about the size of new crop, so why the prices touching the unrealistic levels is not understandable for any one, cotton analysts said. For the last two or three months, it appeared that manipulators are active and trying to manoeuvre the direction of the market, they added.

In the meantime, the ginning factory in Haroonabad has stared ginning for the new crop, they said. On Tuesday, the cotton futures finished lower on investor sales and in line with weaker soybean values in Chicago, dealers said.

The key December cotton contract rose 1.13 cents to end at 80.53 cents per lb, dealing from 79.60 to 81.36 cents. Spot July cotton added 1.31 cents to close at 72.19 cents, trading from 71.03 to 72.80 cents. Volume in the December contract stood at 9,531 lots at 2:40 pm EDT (1840 GMT) while July volume amounted to 392 lots. The following deal was reported as some 600 bales from Ghotki sold at Rs 3750, 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 3800.00 50 3850.00
-----------------------------------------------------------
Equivalent
-----------------------------------------------------------
40 Kgs 4072.00 50 4122.00
===========================================================

 

[rakeshmalik]

India cotton prices surge on strong demand, tight supply
26 Jun 2008 10:17 am




Mumbai - Indian cotton prices rose sharply in the week ended Wednesday tracking a strong local demand and a tight supply situation, market participants said.

The price of Shanker-6 grade was quoted at Rs 27,000 a candy, compared with Rs 25,800-Rs 26,000/candy last week. One candy is equivalent to 355.62 kilograms.

Traders expect prices to surge to Rs 28,000-Rs 29,000/candy before the current crop year ends Sept 30.

"High exports this year have affected the availability of cotton in the local markets. Hence, prices will remain firm until the new crop arrives in October," said a Mumbai-based trader.

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.

According to A Ramani, Joint Secretary of the South India Cotton Association, exporters have already contracted to sell 500,000 bales of the new crop in November-December at high prices.

Many mills, which had deferred buying cotton in anticipation of prices cooling down, are now buying cotton, despite high prices, to boost stocks.

India's carry-forward stocks as of Sept 30 are projected at 4.3 million bales, lower than the 6.0 million bales necessary to ensure cotton prices remain competitive.

Sowing of the new crop is nearly complete in the northern states as most of the area is irrigated, while sowing in Maharashtra, a major producer in the country, has began in some areas.

As of June 20, cotton has been sown on 1.45 million hectares, down from 1.53 million hectares a year ago due to lower availability of water in the northern states, a statement from the ministry of agriculture said.

India's cotton production during the coming crop year starting October is expected to rise 3% to 32.5 million bales on a slight increase in the area under cultivation, J N Singh, the Union Textile Commissioner, said.

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

Meanwhile, India's textile industry, which is reeling under high cotton prices due to unregulated exports and tight domestic supply, is seeking restrictions on cotton exports.

"We have requested the government to freeze cotton exports until Dec 31 so that adequate supply is available for the Indian textile industry," said Ramani.

The industry is also seeking the duty-free import of cotton; currently, a duty of 14.7% is levied on imports, he said.

 

[rakeshmalik]

Cotton lint gains in north India
26 Jun 2008 3:59 pm

Abohar - Spot cotton lint prices gained slightly by Rs five-Rs 10/maund amid normal demand at major markets across north India Thursday. Traders say, the limited stocks and reports of declined acreage of cotton in the country are supporting the market.

After northern India, Gujarat too is expected to witness decline in cotton acreage this season. According to experts, cotton acreage would be reduced by around 15 per cent as farmers are switching over to groundnut crop following delayed monsoon in Gujarat.

Across Punjab, cotton lint traded at Rs 2,810-Rs 2,820/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,810-Rs 2,820/maund at Malot and Gidarbha; Rs 2,800-Rs 2,805/maund at Abohar; Rs 2,800-Rs 2,805/maund at Manasa; and at Rs 2,830-Rs 2,835/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,730-Rs 2,750/maund in Haryana and at Rs 2,550-Rs 2,620/maund in Rajasthan.

 

[rakeshmalik]

Cotton lint prices touch record high in western India
26 Jun 2008 4:39 pm

Mumbai - Cotton lint prices were quoted at the record high at the spot markets across western India Thursday amid consistent demand from millers, limited stocks in the region and reports of declined acreage of cotton. Meanwhile, besides Gujarat, sowing of cotton has not been satisfactory so far in Madhya Pradesh and Maharashtra.

After northern India, Gujarat too is expected to witness decline in cotton acreage this season. According to experts, cotton acreage would be reduced by around 15 per cent as farmers are switching over to groundnut crop following delayed monsoon in Gujarat.

At Kadi market in Gujarat, cotton lint S-6 A-grade was quoted at Rs 27,000/candy while average-grade traded at Rs 26,500/candy.

In Vidarbha region of Maharashtra, the 28-mm cotton lint traded at Rs 26,800-Rs 27,000/candy while 29-mm cotton lint traded at Rs 27,200-Rs 27,600/candy.

At Sendhwa market in Madhya Pradesh, the 28-mm cotton lint traded at Rs 26,500-Rs 27,000/candy; 29-mm cotton lint traded at Rs 27,200-Rs 27,500/candy; and 30 mm cotton lint at Rs 27,600-Rs 28,000/candy.

................................................................................................................

Cotton lint gains in north India
26 Jun 2008 3:59 pm

Abohar - Spot cotton lint prices gained slightly by Rs five-Rs 10/maund amid normal demand at major markets across north India Thursday. Traders say, the limited stocks and reports of declined acreage of cotton in the country are supporting the market.

After northern India, Gujarat too is expected to witness decline in cotton acreage this season. According to experts, cotton acreage would be reduced by around 15 per cent as farmers are switching over to groundnut crop following delayed monsoon in Gujarat.

Across Punjab, cotton lint traded at Rs 2,810-Rs 2,820/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,810-Rs 2,820/maund at Malot and Gidarbha; Rs 2,800-Rs 2,805/maund at Abohar; Rs 2,800-Rs 2,805/maund at Manasa; and at Rs 2,830-Rs 2,835/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,730-Rs 2,750/maund in Haryana and at Rs 2,550-Rs 2,620/maund in Rajasthan.
...............................................................................................................
New York cotton futures remain higher
NEW YORK (June 27 2008): Cotton futures finished higher Thursday on investment fund buying as the market bounded up on the back of rallies in grains and other commodity markets. The key December cotton contract rose 0.69 cent to end at 81.77 cents per lb, dealing from 81.01 to 82.24 cents.

Spot July cotton added 1.11 cents to finish at 74.09 cents, trading from 72.82 to 74.25 cents. Volume traded in the December contract stood at 11,600 lots at 2:46 pm EDT (1846 GMT) while July volume amounted to 104 lots.

"We followed the outside markets. This was just the bulls' day out," said Mike Stevens, senior analyst for brokers SFS Futures in Mandeville, Louisiana.

Cotton was well-supported by a rally whose main catalyst was the weak dollar, dealers said. Corn prices soared the 30-cent limit to a record high and this bolstered buying in fibre contracts as well, traders said. Stevens said the December cotton contract appears trapped in a band running from around 79 to 82.50 cents. He said an upcoming government plantings report may keep the contract pinned in this band.

"Unless there's a shock and surprise, it's going to be difficult to get it out of its trading range," said Stevens. On Monday, the US Agriculture Department will be releasing its annual and much-awaited planted acreage report. The market showed little reaction to the weekly USDA export sales data.

USDA said total US cotton sales stood at 29,000 running bales (RBs, 500-lbs each), from 43,500 RBs in last week's report and trade belief it would range from 40,000 to 100,000 RBs. USDA said US cotton export shipments of previously booked orders hit 286,600 RBs, against 312,800 RBs in last week's report.

Brokers Flanagan Trading Corp sees support in the December contract at 81.35 and 79.60 cents, with resistance at 82.15 and 83.80 cents. Volume traded Wednesday hit 12,152 lots, exchange data showed. Open interest in the cotton market rose 1,029 lots to 215,041 lots as of June 25, ICE Futures US said.
....................................................................................................................
Spot rate down by Rs 50 on cotton market

KARACHI (June 27 2008): Sharp decline was seen in the official spot rate on the cotton market on Thursday. With the increase in seedcotton arrival prices have come down to Rs 1800 per maund from Rs 2100,a deal in the evening at Pakpattan was reportedly struck at Rs 1600 dealers said.

After maintaining a stable trend for several weeks, the Karachi Cotton Association (KCA) official spot rate was droped by Rs 50 at Rs 3750, dealers said. Similarly prices of cottonseed also have taken downtrend sliding to Rs 850 per maund from Rs 950.

After the good arrival of phutti, further fall in the prices was expected due to spinners wait-and-see attitude, they said. Market players were anticipating that the slight rains in cotton belt was good and now dryness is best for the picking operation. Market sources attributed the fall in the daily intake to lethargic attitudes by the mills, who hoped that increase in supply will bring down unrealistic rise in the prices.

During the last six months, the artificial food crisis the world over caused shifting of mind-set as many farmers and growers who were cultivating cotton or sugarcane, now think to cultivate rice or wheat for better return. Farmers are concentrating on rice, as a result other crops are not getting the required water, partly because of irrigation problems.

Besides, the State Bank of Pakistan (SBP) has ended the three percent mark-up facility for spinners, an extra burden because they are already suffering from sharp rise in the cost of production, leading analysts said.

In spite of these concerns, interesting thing to note is that some manipulators will be dominating the market and try to give an unusual increase by different practices, they said. The textile sector is already under pressure and this year it is most likely that the country may miss the 12 billion dollars export target, they said.

In the meantime, the news reaching the market is some encouraging that the current arrival figure is good and delay in monsoon rains are good for picking operations, they added.

As a result of handsome arrival of phutti, the prices fell modestly and it is expected that the prices may continue downward run, they said. On Wednesday, the NY cotton futures finished higher on investor sales and in line with weaker soyabean values in Chicago, dealers said.

The key December cotton contract rose 1.13 cents to end at 80.53 cents per lb, dealing from 79.60 to 81.36 cents. Spot July cotton added 1.31 cents to close at 72.19 cents, trading from 71.03 to 72.80 cents. Volume in the December contract stood at 9,531 lots at 2:40 pm EDT (1840 GMT) while July volume amounted to 392 lots. Only a deal was reported as some 1000 bales (exporter to mill) sold at Rs 3750, they said.

 

[rakeshmalik]

ICE cotton up on grains spill over
27 Jun 2008 10:24 am

New York - ICE Futures US cotton posted gains Thursday on a strong grains spillover and expectations for a bullish acreage projection next week.

Cotton opened higher and rose as the session progressed with support from stronger commodities prices on the weaker US dollar. Despite a marketing year low in weekly Upland sales released mid-session, the market maintained strength. Traders are looking ahead to the US Department of Agriculture's revised planted acreage report for 2008. Expectations for reductions are adding bullishness to the market, analysts said. The report is scheduled to be released at 8:30 a.m. EDT (1230 GMT) Monday.

Futures may sink Friday if commodities are weaker, but the market would attempt to follow higher outside prices, said Mike Stevens, analyst at SFS Futures in Mandeville, La. Resistance for December is at 82.30, said Keith Brown, principal of Keith Brown & Co. in Moultrie, Ga.

ICE daily cotton stocks increased by 4,465 480-pound bales Wednesday to total 1.638 million bales with 50,154 awaiting review.

ICE cotton open interest increased by 1,029 positions Tuesday to total 215,041, according to the exchange.

Volume was estimated at 13,387 lots. In options, approximately 6,896 calls and 2,619 puts traded, according to exchange data.

Close Change Range
Jly 74.09 +111 pts 72.82-74.25
Oct 78.39 +88 pts 77.74-78.69
Dec 81.77 +69 pts 81.01-82.24

 

[rakeshmalik]

Cotton lint climbs on low acreage
27 Jun 2008 3:57 pm

Abohar - Supported by the bullish trend in international market, limited stocks in the country and consistent demand from millers pushed spot cotton lint prices up by Rs 30/maund across north India Friday. Traders say, the market is gaining strength on reports of declined acreage of cotton in many parts of the country.

After northern India, Gujarat too is expected to witness decline in cotton acreage this season. According to experts, cotton acreage would be reduced by around 15 per cent as farmers are switching over to groundnut crop following delayed monsoon in Gujarat.

Across Punjab, cotton lint traded at Rs 2,850/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,850/maund at Malot and Gidarbha; Rs 2,830-Rs 2,835/maund at Abohar; Rs 2,830-Rs 2,835/maund at Manasa; and at Rs 2,855-Rs 2,860/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,700-Rs 2,775/maund in Haryana and at Rs 2,600-Rs 2,705/maund in Rajasthan.

 

[rakeshmalik]

India may become world's No. 2 cotton exporter
28 Jun 2008 10:17 am

Chicago - India is set to pass Uzbekistan as the world's second-largest exporter of cotton, according to a research report by Rabobank. Rapidly rising cotton production in India comes amid a move in China toward planting grains while US export supplies dwindle, the report says.

"The main reason for the success of India's cotton program has been the implementation of a government program that targeted improvements in seeds, extension services, marketing infrastructure and processing facilities," says Michael Whitehead, vice-president of food and agribusiness research and advisory at Rabobank and author of the report. However, India's growing textile manufacturing base could eat into the country's cotton supply for exports, the report says.

India is the world's second-largest cotton producing country behind China, though Uzbekistan exports more of its cotton crop. China is the world's top cotton producer.







.

 

[rakeshmalik]

Activity improves on cotton market

KARACHI (June 28 2008): Activity improved on the cotton market on Friday as some spinners made buying to meet the near terms requirements, dealers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3750, dealers said. In the ready business, the phutti prices in Punjab were at Rs 1600-1700 and in Sindh the seedcotton was trading at Rs 1700-1750, they said.

Cottonseed was trading at Rs 800, they added. A deal of 200 bales of cotton from the new crop was done at Rs 3825, they added. Market sources said that a few mills struck deals to make up their requirements because they could not afford to wait for decline in the rates.

Some mills were active and covered forward buying in anticipation of increase in the prices, they said. Some analysts said that it can't be assumed the exact crop size and about the damages before time.

In the meantime, a news appeared that the US Agriculture Department will probably reduce its estimate for US 2008/09 cotton sowings, but industry analysts wonder whether the severe damage in Texas cotton farms will make it into the report. The USDA will issue its annual planted acreage report on Monday.

Most analysts feel US cotton plantings will reach 9.1 million to 9.2 million acres, but some believe the report will show sowings as low as 8.45 million acres. Last March, the USDA pegged US cotton plantings at a 25-year low of 9.39 million acres. "It will be a good picture, but the question is how much of the damage (in Texas and other states) can they incorporate in this report," Carl Anderson, an influential economist who used to work with Texas A&M University, told Reuters.

The following deals were reported :1600 bales of cotton(exporter to mill) sold at Rs 3950, 220 bales of cotton from Ghotki at Rs 3700, 491 bales from Dharki at Rs 3800, 400 from Hyderabad at Rs 3940, 200 bales of new crop from Arifwala at Rs 3825 and 400 bales from Sultanabad for September 5, delivery at Rs 3700, 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
===========================================================