MARKET OUTLOOK

India: Market is easy to steady. ♦ US Cotton Futures: Cotton prices turned back lower today and like Tuesday spent the entire session below unchanged in light activity. The up one day-down the next pattern continues to support the notion that prices are attempting some sort of correction or at least consolidation of the recent run up in values. Outside markets may have also played a role in today s lower close. Bearish weather for the grains and higher than expected new crop forecasts weighed on these markets. After a month of lagging behind, Dec has begun to attract attention as being undervalued and/or needing to bid for acres in the new US crop. Though a further decline in grain prices may limit Dec's ability to rally in the near term as cotton becomes more attractive. The USDA will give us an update supply and demand projection next Wednesday night, prospective plantings will not be released until March 31.

There were 18,480 tons of cotton concluded on CNCE(China National Cotton Exchange)'s e-market  7,540 tonnes more than the previous session. Open interests were 520 tonnes more than previous session to 124,480 tons on 3/3/10

Insufficient stocks to hit textile sector : KARACHI: The country has insufficient number of cotton bales to meet the daily requirements of textile sector in the country, traders at Karachi Cotton Association (KCA) said on Thursday. KCA member Shakeel Ahmad said, production of cotton bales remained around 12.65 million cotton bales during crop season 2009-10 with a shortfall of about 2.30 million bales.

COTTON & TEXTILE NEWS

• India has no plans to ban cotton exports - Minister : India has no plans to ban exports of cotton as the country has sufficient stocks of the fibre, the junior textiles minister told parliament on Thursday. "There is sufficient stock of cotton in the country to meet the demand of the mills as well as export. No proposal is under consideration for banning the cotton export at this stage," Panabaaka Lakshmi said in a written reply. Domestic textile mills have been asking the government to curb exports. The minister said government efforts and the introduction of bacillus thuringiensis or Bt cotton have helped raise output substantially. She said output in the year to September was expected at 29.5 million bales (1 bale=170 kg), sharply up from 15.8 million bales in 2001/02. Courtesy – Reuters

• Cut in yarn export quota to damage spinning sector: Aptma KARACHI - All Pakistan Textile Mills Association Acting chairman Shahzad Ahmed has said the cut in yarn export quota from 50,000 to 35,000 tons per day will not only harm the spinning sector but also the entire textile industry. He was addressing a press conference along with a senior member APTMA and former president FPCCI S M Muneer at APTMA House Thursday. “This will not only stop yarn export but will also jeopardize the all the letters of credit (L/C) already opened by the foreign buyers of Pakistani cotton yarn”, he noted. Muneer said that for the first time, spinning sector is getting good business in the last three years and the government should not impose its unilateral decision. He said mills have invested $ 6 billion for the up gradation and modernization in the last several years and if they are stopped from exports the amount of default will soar again.

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