MARKET OUTLOOK

India: Market is overall steady. ♦ US Cotton Futures: Cotton prices turned back higher last night with strong gains noted across all months. The market appeared to gain strength from outside markets with fears over Greece's and EU troubles began to wane. The US $ tumbled as traders exited the safe haven and returned money to the commodity space. Gold, Oil, Grains, etc were all higher with the CRB index up nearly 1%. Prices found support rather quickly, a testament to the strength of the current bullish trend. The markets ability to recover most of yesterday's losses gives the bulls confidence after Tuesday's shake down. Though no support or resistance was breached so there is no confirmation that we are through with the correction or are resuming the bullish trend. It was noteworthy to see the strength in the December contract. Last night was the first time in a while that in gained in line with the front months. Some of the strength may have come from the specs as they are being told the front of the board has run too far too fast and the new crop and forwards offer the best values.

Traders are also awaiting the monthly US department of agriculture report due out on march 10 along with weekly Us cotton exports data scheduled too be released today for cues on recent cotton demand.

Futures have risen 21.5% since feb 5 boosted by expectations that growing world demand would boost US exports sales and draw on available supplies.

 

COTTON & TEXTILE NEWS

• Global cotton prices up 14% : Global cotton prices have shot up nearly 14 per cent to 85.5 cents per pound (Rs 30,908 per candy) in February due to tight world supplies and recovery in demand, international cotton body ICAC said. “Cotton prices increased sharply in Februar y 2010,” the International Cotton Advisory Committee (ICAC) statement said. Global prices, which were ruling at 75.35 cents per pound (Rs 27,238 per candy) on February 1, have risen to 85.5 cents per pound (Rs 30,908 per candy) on February 26. One candy weighs 356 kg of cotton. The ending stock of cotton is expected to be lower at 10.5 million tonnes (MT) in the current season compared with 12.33 MT in the last year, according to ICAC forecast. The world cotton output is likely be slightly lower at 22.2 MT in the 2009-10 season from 23.42 MT in the year-ago period. Global consumption is estimated to be at 24.1 MT. Taking firm cues from the world cotton market, domestic cotton prices have also s hot up by 4 per cent to Rs 27,100 per candy. According to the Confederation of Indian Textile Industry (CITI), the domestic price of Shankar-6 cotton has increased to Rs 27,100 from Rs 26,000 per candy in the past one month. Similarly, J-34 cotton variety has risen to Rs 25,300 from Rs 25,000 per candy in the review period. – PTI. Courtesy – The Hindu Business Line

• Karachi Cotton Association Price : The Karachi Cotton Association on Wednesday fixed the official spot rate, or base price, for Grade 3 cotton at 6,055 rupees per maund (40 kg). The Grade 3 cotton has a staple length of 1-1/16" (inches) and micronaire value between 3.8 to 4.9 NCL (no control limits) which represents fine to coarse classes of cotton varieties. In the kerb market the key crop varieties traded in the range of 5,500 to 5,800 rupee per maund. Courtesy – Reuters

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