Official spot rate and seed cotton prices went up sharply on the cotton market on Monday in the process of modest trading activity, dealers said. The official spot rate gained Rs 100 to Rs 7,600, they added. In the ready session, approximately, 600 bales of cotton changed hands between Rs 7725-8075, they said. Nearly 400 bales of new crop cotton from Shahdad sold at Rs 8275, they said. Prices of seed cotton in Sindh are available at Rs 3900-4100, they said.
Commenting on the fresh development, cotton analyst, Naseem Usman said that cotton prices are already going up due to higher rates in the international market and strong demand in the local market, as well. He also said that dollar's appreciation versus the rupee likely to push up rates in the cotton market.
They said that previous government kept artificially high rate of the rupee against the dollar, under the circumstances, interim government allowed the State Bank of Pakistan (SBP) to bring down rupee in terms of the dollar.
Other brokers said that increase in phutti arrivals may keep a balance between demand and supply, if supply not meets, demand position, this factor likely to boost prices in the coming days.
Cotton remained up in the Indian and Chinese markets, they said. Besides, report showing that China sold 11,700 tonnes of cotton at auction of state reserves at an average price of 14,977 yuan ($2,338.84) per tonne, according to industry website cncotton.com
Sales represent 39 percent of total cotton available at the auction. The following deals reported: around 200 bales of cotton from Sadiqabad sold at Rs 8075 and 400 bales of cotton from Rahim Yar Khan at Rs 7725, dealers said.