Cotton Dips Anew On Heavy Inflows

Cotton prices dropped once again on the Mumbai cotton market last week.

Heavy pressure of arrivals from Punjab and rising inflow in Gujarat, Madhya Pradesh and South, adversely affected the sentiment.

The demand from mills remained limited.

In Punjab, arrivals increased to more than 25,000 bales a day while the offtake was hardly 10,000 bales. Consequently, sellers were forced to liquidate the supplies.

With the end of the purchases by the Cotton Corporation of India in Bengal deshi, the prices ruled above the support levels.

At the same time, due to funds crunch, heavy purchases at this juncture by the Cotton Corporation of India was ruled out.

 

Mills were not at all going for building up any inventory, while exporters were seen picking cotton as and when commitments entered.

But unless mills start building up inventory for three months stocks, the prices are unlikely to stabilise or show modest recovery. Besides, arrivals of cotton in Gujarat areas was on the rise.

Earlier, Shankar-4 was seen flooding the market.

Sellers were keen on offering new Kalyan on forward delivery basis as they feared that prices would drop with the pressure of arrivals.

Kalyan new attracted moderate buying support but prices of old cotton dropped by Rs 400-500 per candy.

Punjab saw gin reported further widening gap between inferior and quality cart selected cotton varieties .

Saw gin inferior dropped below Rs 1400 mark to be placed at Rs 1375-1390.

But quality cotton was demanded at Rs 1600-1625 per Bengal maund.

F-414 eased to Rs 1775-1820 per Bengal maund.

Cloth: Despite the demand season in full swing, activity was at a very low ebb on the Mumbai cloth market last week. Also, the raids by the customs department dampened the spirit to a large extent.

It was reported that the Income-Tax department had been visiting the small cloth dealers to enrol as income -tax payers by making small payments to, small traders.

Meanwhile, reports from upcountry centres had been discouraging.

It was felt that with the recent cold wave in Punjab, Delhi, Rajasthan and Gujarat, demand at the retail level would be very poor.

Moreover, demand for Ramzan and Id seasons was disappointing.

Reports from Surat indicated that the stocks of shining viscose dress materials and sarees were piling up, resulting in drop in prices. Even demand in Bhilwara for suitings was poor.

Also, the poor demand for summer wares resulted in decline in prices.

Meanwhile, Hindustan Mill had called a meeting of its agents at Matheran recently.

There the business for February and March had been booked at the current prices, while forApril- May, the business was booked at the then prevailing prices of the mills.