July 10, 2003	Thursday	Jumadi-ul-Awwal 9,1424

KARACHI, July 9: Quieter conditions were again witnessed on the cotton market on Wednesday as both ginners and spinners remained locked in a price war, but it appears to be a no-win situation for the both.

As a result for the second session in a row not a single bale of the new or the old crop changed hands as ginners were not inclined to lower their asking prices and spinners were not in an obliging mood, dealers said.

They said the current spell of monsoon rain in the entire cotton belt had brightened the prospects of a good crop, and if all went well with the other relevant factors vital for a healthy crop, chances of a bumper crop were not ruled out.

After the suspension of picking operations of phutti owing to rain and drying up of arrivals of the new crop into the lower Sindh ginneries, ginners have raised their asking.

But spinners are in no obliging mood as they have to operate in line with their export parity levels for cotton yarn and cloth. Hence the standoff remained on the ready market.

However, leading brokers predict resumption of normal ready business after the current spell of monsoon rain is over and ginners have adjusted local prices in line with the international ones.

According to some brokers, ginners were asking price for the new crop lint at around Rs2,400 and that of the current crop at Rs2,500 per maund what the claim was in line with the prevailing world rates.

For the last couple of weeks, spinners have suspended imports of foreign lint after prices soared to 60 cents per lb as they add to overheads and make export of textile more expensive, they added.

Meanwhile, reports coming from the lower Sindh cotton belt indicate that picking operations of phutti may not be resumed by early next week, and by that time ginners may not get any fresh supplies of the new crop.

However, those ginning mills, which have already some stocks of phutti are expected to resume operations during the next couple of days and the lint will be available by early next week, brokers said.

After having risen to new peak levels, New York cotton futures attracted selling and fell 0.88 and 0.46 cents per lb at 58.42 and 60.21 cents per lb for both the maturing July and the new crop October settlements, respectively.

But there was no change in the local spot rates in the absence of ready business and were held firmly at the previous levels.

No deal was reported in the ready section by leading brokerage houses, although there were reports of some enquiries from the mills and spinners.