Cotton brokers say that before this steep drop prices had been falling Rs200-300 per maund daily for the past few days.
Cotton rates declined to Rs5,300 per maund from Rs6,000 per maund in a single day in the open market on Saturday, said Karachi Cotton Brokers Forum Chairman Naseem Usman.
The regulatory duty on yarn export may be lifted in coming weeks and this is one of the reasons behind declining cotton prices in the local market, he added.
“Cotton prices are expected to come down further,” a cotton broker said. “The pace of decline in cotton rates is similar to the one at which prices shot up in the last three months,” he said. The number of dealings in the cotton market also decreased last week. “Prices are expected to decline with the falling number of dealings,” he added.
International cotton rates have also been falling over the past few days, brokers said.
Last week, local cotton rates soared to a record high of Rs7,750 per maund. The country is expected to produce more than 15 million bales of cotton this season.
Published in The Express Tribune, July 18th, 2010.
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