Weekly Review of Pakistan's Cotton Market
Last week, the price of cotton in Pakistan has been drastically reduced by Rs 2,000 per head. The spot rate has also come down by Rs 2,000 per head. Karachi Cotton Brokers Forum President Naseem Usman said that there is a bearish trend in international cotton. New York cotton futures traded down five US cents.
The price of cotton in Sindh ranges between Rs 18,000 to Rs 20,500 per head. The price of footi is between 6500 to 9700 rupees per 40 kg. The rate of cotton in Punjab is Rs 18,000 to Rs 20,500 per head, while the rate of foot is Rs 7,000 to Rs 10,200 per 40 kg.
The spot rate committee of the Karachi Cotton Association reduced the spot rate by Rs 2,000 per head and closed it at Rs 19,800 per head.
In the domestic cotton market, cotton prices declined by Rs 1,500 to Rs 2,000 per head from the previous week due to cautious buying by textile spinners against panic selling by cotton ginners.
During the last consecutive week, due to strong dollar and L/C issues, textile spinners increased their interest in buying local cotton, due to which the price of cotton increased and relatively good cotton was available at Rs 23,000 per head and on an average . Quality cotton was sold at Rs 21,000 per head and light quality cotton at around Rs 20,000 per head which is currently available at Rs 18,000 to Rs 20,500 per head.
But during the week under review, the government presented a mini-budget taking tough measures to meet the IMF's strict conditions. The government has increased prices of energy and petroleum products, increased GST from 17% to 18%, and abolished zero rating for the export sector. With the removal of energy concessions for export industries including the textile sector and the depreciation of the rupee against the dollar, the textile sector is again in trouble.
On the other hand news is coming that the government is considering increasing the interest rate from 17% to 20%. The escalating conflict between Ukraine and Russia has added to the recession around the world.
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