Slow arrivals of seed cotton pushed rates sharply higher on the cotton market on Tuesday in the process of lean business, dealers said. The official spot rate was unchanged at Rs 7,600, they added. In the ready session, a deal of 1075 bales of cotton from Shujabad sold at Rs 7400, they said. Prices of seed cotton in Sindh are available at Rs 3900-4100, they said.
Supply of irrigation water improving after fresh rain in Sindh and Punjab, cotton analyst Naseem Usman said. He also said that rupee's depreciation versus the dollar is causing steep rise in cotton prices. Besides, brokers said that due to high rate and less supply of seed cotton some factories stopped trading activities in Sanghar.
According to reports, many Indian farmers are openly sowing an unapproved variety of genetically modified (GM) cotton seeds developed by Monsanto, as the government sits on the sidelines for fear of antagonising a big voting bloc ahead of an election next year.
India approved the first GM cotton seed trait in 2002 and an upgraded variety in 2006, helping transform the country into the world's top producer and second-largest exporter of the fibre. But newer traits are not available after Monsanto in 2016 withdrew an application seeking approval for the latest variety due to a royalty dispute with the government. In the world markets, cotton prices moved both ways in the process of trading, they said.