MUMBAI (Commoditiescontrol) – Cotton prices in major global markets moved in tandem with regional fundamentals, irrespective of global benchmarks on Thursday.
US March cotton contract settled up US cent 0.2 or 0.3 percent, at US cents 71.67 per pound on at close on Thursday, supported by strong export sales in the week of December 8. And this strong export sales also neutralized the impact of a surge in US$ which touched a 14-year high against a basket of major currencies. Thus, the strength of the green back did not deter the commodity to become expensive. Generally, strong US$ makes commodities expensive to buyers holding other currencies and are generally adjusted against the exchange rates.
In China, spot cotton market saw fluctuations on Thursday, with offers for Xinjiang-origin hand-picked grade-2128/3128 cotton at 15.50-15.70 Yuan a kg (2.23-2.25 a kg) and grade grade-2129/3129 at 16.30-16.50 a kg (US$ 2.35-2.37 a kg). Buying interest was generally focused on Xinjiang-origin cotton, and suppliers reported sound sales, though many small mills were shut down due to year-end financial pressure and environment protection.
Imported cotton prices moved down for the day. Self-lifting offers for India-origin Shankar-6 cotton were at 15.02 Yuan kg (US$2.16 a kg, down US cent 1) under sliding duties and 13.53 Yuan kg (US$1.95 a kg, down US cent 2) under 1% in-quota tariff. Self-lifting offers for US-origin EMOT SM cotton (loading in December/January) were at 15.66 Yuan a kg (US$2.25 a kg) under sliding duties, and 14.48 Yuan a kg (US$2.08 a kg) under 1% in-quota tariff. Uzbekistan-origin SM was offered at 16.23 Yuan a kg (US$2.33 a kg) under sliding duties and 15.30 Yuan a kg (US$2.20 a kg).
Although, sales were tempering, given the rising cost pressure from new cotton, cotton yarn prices may see minor increases in coming days.
In India, movements were mixed on Thursday as mandis in North India saw price easing Rs45 per bale whereas, Central/South India rallied a bit by Rs95 per bale. Arrivals rose 7 percent across major markets totaling 1.61 lakh bales as against 1.51 lakh bales a day before.
Spot rates of Cotton Association of India, show coarser varieties of cotton were dearer while finer ones cheaper. Bengal Deshi was traded at Rs26,700 per candy, up Rs500 on the day, while Shankar-6 was Rs200 cheaper at Rs38,900 a candy and MCU-5 down Rs300 at Rs40,300 per candy.
In Pakistan, the KCA spot rate inched down PakRs50 to PakRs6,200 per maund. Phutti in Punjab was traded in the range of PakRs2,800-3,500 a maund. In spot, 15,000 bales changed hands ranging from PakRs5,600-6,450 with lower end price up PakRs25 while upper end moderated PakRs50 on Thursday. Demand was dull from yarn makers coupled with squaring of books by corporates owing to bank closing on December 31 slowed down trade activity on Thursday.
(By Commoditiescontrol Bureau; +91-22-40015522)
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