Pakistan: active mill buying supports prices
Stable conditions have prevailed in the local raw cotton market over the weekend. Despite increasing arrivals, active buying from local mills has provided some support to prices. Although underlying sentiment among many spinners is still inclined to the bear side, and yarn prices have fallen to their lowest level for a few years, there is als0 a realization that the scope for further decline may be limited. In this regard, the behaviour of Indian prices will be closely monitored: mills are not unaware of the fact that Indian export prices are close to the levels implied by the country’s Minimum Support Price for seed cotton. In the meantime, spinners in Pakistan are reckoned to be operating well on the basis of current raw cotton replacement costs, which are below international parities. Business in better quality lots from Punjab and upper Sindh has today been reported at around Rs. 5,150/5,300 per maund (roughly 61.00/63.00 US cents per lb), ex-gin.
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