May 31, 2003	Saturday	Rabi-ul-Awwal 28, 1424

KARACHI, May 30: Cotton prices on Friday eased further as the official spot rates were lowered by another Rs10 per maund amid a lightly traded session as leading spinners adhered to the sidelines.

But in physical trading fine lots from a central Punjab ginnery were sold well above the official spot rates indicating the ginners appear to be in no mood to lower their asking prices.

“Any rate above Rs2,500 per maund falls out of parity level,” says a leading ginner adding to think to sell “below this rate after having purchased phutti at Rs1,000 per maund means inviting undue losses.”

Floor brokers said relying on falling unsold stocks of lint as compared to mill demand for the next three months, ginners appear to be in a happy position and could hold on to their stocks despite the bank deadline of June 30, to settle last fiscal outstanding dues.

They said most of the ginners having bulk of the unsold stocks of lint seem to have fully examined the likely negative impact of the higher phutti prices for the new crop after initial bearish reaction and hoped they may in the final analysis will enhance their bargaining capacity.

That was perhaps some of the ginners were obliged to pay as higher as Rs2,550 per maund for stray lots, which came in for trading and readily lifted by the needy among them.

“Ginners know that being in a terribly short supply positions most of the spinners will have to buy lint from the local market at the rates named by them as imports are still expensive despite volatile world rates,” they said and perhaps having this perception in mind “ginners are holding fast to their unsold positions.”

Another negative factor, which has curtailed the mills’ purchasing power are some of the problems on the export front including slowdown in demand and lower bid prices. The piling of unsold stocks is also straining their purchasing power because huge amounts of cash are tied to them.

Meanwhile, reports coming from the Sindh and the Punjab cotton belts indicates in most of the areas new crop sowing has been completed over 60 per cent of the total planting intentions for the new crop.

Ready offtake was light as till late in the evening secretary of the Karachi Cotton Brokers Association has reported the following deals: 600 bales Samundri at Rs2,550 and 400 bales at Rs2,535 per maund without 15 per cent sales tax.