September 15, 2003	Monday	Rajab 17, 1424

Prices of essential items on the Karachi wholesale commodity market generally rose last week. Pressure on ready supplies followed by the reports of holding back of stocks by a leading stockist were main factors.

Largest increase of Rs115 to 140 per bag was recorded in sugar followed by reports that the government had directed the Trading Corporation of Pakistan to build up a buffer stock of 0.1 million tonnes for adequate supply during the month of Ramazan. Reports of holding back of stocks by the millonwers was another aiding bullish factor.

But on the other hand the industrial raw materials stayed weak followed by the reports of oversupply on account of steady arrivals from the upcountry trading centres.

Ready offtake, both by the commercial houses and the brokers remained on the lower side as no one among them was inclined to buy at higher levels, anticipating a decline once the supply position improved.

Dealers said sugar remained in the news throughout the week followed by reports that the crushers had formed a cartel to push the prices higher from current levels.

Sugar prices were expected to rise further in the coming weeks if corrective steps were not taken to protect the interests of the general consumer, they feared.

Owing to higher production of 3.6 million tonnes in the last season, the sugar millowners were holding back the unsold stock of about a million tonnes, which in turn kept the prices substantially lower at around Rs1,700 per bag.

Market sources said that because of higher production costs, export of the commodity was not feasible on world markets. The Trading Corporation of Pakistan (TCP) had exported 0.1 million tonnes of the commodity after the government subsidized foreign sales.

Local millowners were also urging the government to give subsidy so that they could sell an exportable surplus of half a million tonnes to foreign buyers but the government had remained silent on the issue, they said.

Other essential commodities, notably pulses also showed a sympathetic rise followed by the reports of pressure on ready supplies.

Wheat prices showed a modest decline of Rs5 followed by the reports of increase in the arrivals from Sindh markets and a reported slack mill-demand.

Rice sector showed firm trend followed by the reports of fresh forward export agreements with foreign importers. Some private sector exporters who had stray stocks of the old crop were selling them at higher rates to foreign buyers.

Two ships were in the port loading about 13,000 tonnes of the commodity, which also included new crop from the Sindh markets, signalling that the export had resumed after about two months as stocks of old crop were exhausted.

Pulses showed firm trend. Prices of gram, gram dal, beetle, peas and masoor dal posted gains ranging from Rs40 to 100, the biggest rise of Rs115 to 140 being in beetle. Others were including urad and tuver were traded at the previous levels.

Cereals on the other hand depicted divergent trend amid alternate bouts of buying and selling. While maize rose by Rs10, jowar and barley were held unchanged at the last levels. But on the other hand bajra came in for fresh selling and was marked down by Rs30 to 75.

Guar remained under pressure and was quoted lower by Rs25 on the selling by local stockists followed by the reports of a healthy new crop due in late October.

Oilseed sector showed steady trend amid active trading followed by reports of a fall in new crop arrivals of cottonseed from the Sindh ginneries. Prices remained stable owing to firm oil and cakes markets.

Rapeseed on the other hand came in for active support and finished higher by Rs15 to 25 amid active trading. Pressure on supplies was another aiding positive factor. Til was traded at the last levels and so did the castorseed followed by the reports of weak oilcake market. Prices fell by Rs15 to 20.

Oilcakes showed mixed trend while cottonseed cakes rose by Rs5, rapeseed cakes suffered a fall of Rs2 to 5 amid active trading.—M.A