October 31, 2002	Thursday	Sha’aban 24,1423

KARACHI, Oct 30: Cotton prices on Wednesday eased modestly from the recent higher levels as arrivals of phutti into the ginneries gathered fresh momentum.

Reports that growers are not inclined to hold long positions or send phutti on unfix basis seem to have unsettled the current price outlook, dealers said.

They said the fall of phutti prices before the last week’s higher level of Rs1,000 per maund has a sympathetic negative impact on the lint rates in the ready section.

But leading cotton analysts are not inclined to entertain the idea of any sharp fall in prices of both phutti and lint at least for the near-term until the size of the crop is fully ascertained.

The current conflicting reports about the pest attack in some areas are not verified by official crop monitoring committees, which still stick to their original estimate of 10.5m bales, they added.

However, spinners are said to be a bit happy over the recent developments on the cotton front and hope an imminent price flare-up has been contained at least for the near-term.

Some spinners fear the current pause is temporary and prices are expected to rise during December as leading producers, including China and India, will harvest lower crop owing to damage to standing crops by rain and floods.

The recent softening in the New York cotton futures and their inability to hit the high mark of 50 cents per lb as widely speculated also have a negative impact on world prices.

Floor brokers said the near-panic mill buying reflected that both spinners and composite mills had secured substantial export orders for yarn and cloth for the quarter ending Dec 31, and are covering forward positions against foreign sales.

“Both steady arrivals of phutti and near-panic mill buying reflects those closely associated with the cotton trade are unsure about the nearby supplies and the consequent uncertainty,” they added.

There was no change in the official prices for the third session in a row, while in the ready section bulk of the business was done below them.

New York cotton futures showed fresh fractional decline of 0.9 and 0.18 cents at 46.22 and 48.22 for both the ruling December and the distant March settlements, respectively.

Ready offtake was active as till late in the evening over 10,000 bales changed hands, the following being some of the important deals:

SINDH VARIETY: 400 bales from Tando Adam at Rs1,975; 200 bales, Shahdadpur at Rs1,975; 200 bales, K-68, Bhiria Road at Rs2,125; and 1,000 bales from Sanghar at Rs2,000.

PUNJAB TYPE: 1,000 bales from Bahawalpur at Rs2,150; 1,000 bales, Rajanpur at Rs2,150; 1,000 bales, Muridwala at Rs2,110; 1,000 bales, Mian Channu at Rs2,075 to Rs2,110; and 2,000 bales from D.G. Khan at Rs2,100 to Rs2,125.