May 15, 2003	Thursday	Rabi-ul-Awwal 12, 1424

KARACHI, May 14: Physical activity on the cotton market on Wednesday remained relatively slow as spinners stayed on the sidelines owing to Thursday’s closure on account of Milad-un-Nabi.

Some of the spinners who need immediate supplies did not make fresh commitments because of delivery problems, although ginners from the central Sindh cotton belt were inclined to lower their asking prices for the inferior stuff, brokers said.

But reports coming from the southern Punjab cotton belt, where bulk of the unsold stocks are lying, indicate that stray lots did change hands around Rs2,500 to Rs2,550 per maund for forward delivery, they added.

Floor brokers said the near-term outlook appears to be steady as in the final analysis supply and demand factors will prevail and owing to falling unsold stocks ginners may be the chief beneficiary.

However, as the total mills buying at 9.4m bales reflects, spinners have still to go a long way to meet their annual consumption needs for the current season ending August 31, they added.

Market sources said spinners failed to get the maximum benefit from the steep decline in world prices last week when Sars-related selling pushed New York cotton futures to 50 cents per lb.

The predictions that China may cut its imports of lint cotton from the US or other countries because of Sars, has temporarily jolted world markets but spinners expecting further fall in prices failed to benefit from this shock selling.

Market sources said as the stock position of the spinners shows, they still have to go a long way to cover their annual consumption needs for the current year ending Aug 31.

According to spinners they have so far purchased about 9.4m bales against their projected annual demand of 12.5m bales against the total local crop of 9.7m bales.

The official import figures show that spinners have imported 0.540m bales of the lint so far and may need another 0.7 to 0.8m bales to fully cover their forward sales of cotton yarn and cloth. Last season they had imported a total of 1.238m bales.

On the export front, private sector exporters have sold another 230 bales to some Far Eastern buyers, total foreign sales being 0.184m bales, according to official figures.

There was no change in the official spot rates but New York cotton futures suffered modest fall of 0.14 and 0.15 cents for both the ruling July and the distant December settlements at 54.01 and 58.02 cents per lb respectively.

Ready offtake was light as till late in the evening about 1,500 bales from the southern Punjab ginneries changed hands.