KARACHI: Cotton prices found no respite from an unabated spike during the week with the industrial input traded at season’s high rates as its downbeat local production continues to widen demand and supply gap, traders said on Saturday.
Traders said cotton was traded at the highest prices of the season during the outgoing week while production is expected at around 6 million bales this year.
Price of cotton of Sindh were Rs10,000 to Rs10,700 per maund. Cotton of Punjab was sold at Rs10,200 to Rs11,000 per maund, while lint from Balochistan was sold at Rs10,500 per maund.
Naseem Usman, chairman of Karachi Cotton Brokers Association said price uptrend also took cue from the international market. After an increase of 14 cents from 68 cents per pound to 82 cents per pound in the New York Cotton Futures Market, prices closed to around 80 cents per pound.
Trading remained active in the market due to interest of both buyers and sellers. Buyers rushed to stock up as the current season is expected to remain shortened, which resulted in an increase in the prices.
Cotton production came down to 5.5 million bales from as much as 15 million bales recoded annually in previous years.
Due to an increase in the prices of cotton yarn, Towel manufacturers appealed to government to get the yarn export banned. Value-added exporters also demanded removal of five percent custom duty on import of cotton yarn.
Textile spinners said due to a decline of cotton production to the critical level and an increase in the prices of cotton in the international market, prices of yarn have increased in the local market. Textile and spinning mills are operating in full capacity and demand for import of duty free yarn is not understandable.
Textile exports in December reached to an all-time high of over $1.4 billion. The industry has been getting a jab since the government decided to manage coronavirus outbreak through avoiding all-out lockdown.
The country is receiving export orders diverted from other parts of the world under full or partial economic shutdown.
Cotton exports from the USA during the week increased 113 percent. Out of which, the highest import orders of 152,000 bales were placed by India, followed by Pakistan with orders for 56,600 bales.
Prices also increased in Brazil, Argentina, Central Asia and India. Cotton production in India is expected around 37 million bales. Cotton Corporation of India has fixed support price of lint over there while government provides subsidy and incentives to both the growers and ginners.
Source: The News