October 16, 2001	Tuesday	Rajab 28, 1422

KARACHI, Oct 15: Trading on the cotton market on Monday resumed on a dull note as spinners adhered to the sidelines most of the time and did not make fresh buying offers because of delivery problems.

The physical trading in part was also affected owing to strike called by the religious parties to protest against the US bombing on Afghanistan and its negative impact on the local production lines and including foreign trade, dealers said.

Some of the needy spinners were, however, claimed to be in the market and were willing to take delivery of the contracted lint during the next couple of days but ginners were not inclined to oblige them, they added.

However, reports coming in from the central Punjab cotton belt indicate that local spinners continued to make direct purchases from the ginners between Rs.1,650.00 and 1,700.00 per maund depending on quality.

But local lint is being quoted slightly above this rate as lower Sindh ginners are not inclined to lower their asking prices because of quality factors.

Floor brokers said although there was no change in the basic market fundamentals as far as the supply and demand factors are concerned, an active purchases being made by the Trading Corporation of Pakistan (TCP), continue to heat up the price line.

According to them, the TCP is paying a higher price for the lint than the prevailing international rates apparently to push up prices of phutti from the current lows. The TCP purchase prices of quality lint is Rs.1,855.00 per maund.

But spinners claim after buying lint at higher rates, the TCP is adding to the production cost of the spinners but how will it “benefit or ensure a fair price for phutti to the grower is not clear”.

The government should take some other steps to boost phutti prices as raising the lint rates may have no relevance to the issue but will make textile exports more expensive and uncompetitive on the world markets, they add.

Meanwhile, reports coming from the southern Punjab cotton belt show that picking operations of phutti have just started in some of the areas. Spinners are awaiting the sale of maiden lots from the Rahimmyar Khan, which has already been declared a “model ginning area” and lint from here will be purchased at premium of Rs.200.00 per bale by the spinners because of its fine quality.

The government has already okayed the premium scheme ensuring an enhanced rate for the contamination-free lint.

Ready offtake remained slow as both spinners and ginners maintained a status quo because of ready delivery problems.