May 22, 2003	Thursday	Rabi-ul-Awwal 19,1424

KARACHI, May 21: Cotton prices on Wednesday remained stable around the previous levels as some of the spinners and mills have resumed buying operations to cover their nearby needs.

For the second session in a row, stray lots again changed hands at rates depending on the quality of lots in trade and their quality premiums, brokers said.

There was, however, a wide difference between the fine and the inferior lots as the former were sold around Rs2,550 per maund, while the latter at Rs2,275 for the central Sindh variety.

Floor brokers said there was no alarm in the ginning sector despite the absence of spinners from the market for the last couple of sessions as none among them indulged in hasty selling and most of them held on to their positions. “Most of them, notably those holding on long positions were a little worried over the absence of the buyers as they knew that unsold stock of about 0.250m bales may not be problem for them to sell”, they added.

Both the spinners and the ginners were well aware from the fact that the total crop of 9.7m bales is far below the annual consumption needs of the former and their chief worry was to maintain prices within the current levels without allowing speculative forces to enter the arena and they successfully maintained the status quo.

Dealers said that now the arrival of new crop from the lower Sindh cotton belt is not that far, they decided to re-enter the market to resume covering purchases on a modest scale, not allowing ginners to further raise their asking prices.

Indications are that in the next couple of weeks, preceding the arrival of the new crop, the current status quo will be maintained as any price rise above the current level will make them uncompetitive in falling world cotton yarn market, they said.

Spinners said the fresh decline in New York cotton futures and its negative impact on the world prices is expected to make imports more competitive during the next couple of weeks but “we will prefer to lift the local stuff on priority basis.

The New York cotton futures on Tuesday were marked lower by 0.76 and 0.70 cents per lb for both the ruling July and the new crop October settlements at 53.44 and 56.20 cents respectively.

There was, however, no change in the local spot rates, which were again quoted at the last levels.

Ready offtake was light as till late in the evening about 2,000 bales changed hands, the following being some of notable deals: 500 bales, Nawabshah at Rs2,275, 400 bales, Mirpurkhas at Rs2,550, 500 bales, Dharki at Rs2,500 and 400 bales, Bahawalpur at Rs2,550.