November 10, 2003	Monday	Ramazan 14, 1424

A sharp increase of Rs110 per bag in wheat price highlighted last week’s trading on the Karachi wholesale commodity markets. Other essential items mostly, fell under the lead of pulses.

Although, wheat had risen to Rs1,200 per bag a couple of years back as compared to the last weekend’s Rs1,070, but there appears no immediate reason to attribute it to current price flare-up. Moreover, the late selling pushed it down to finish at Rs1,035, up by Rs95 over the last week’s close.

Never before such a big price increase was recorded in wheat in a single session in an open market trading. Indications are that the prices could rise further if the current speculative squeeze continued.

“The crop was short of the target last year but the government had banned the export to ensure competitive prices, both for the general consumer and the flour mills”, they said.

According to official figures the government still holds a stock of about half a million tonnes, enough to meet any emergency until the new crop arrives in the market by April next.

Moreover, private sector and local commercial houses also hold a substantial quantity of the commodity in their warehouses to meet any emergency.

“The current price flare-up seems to have been caused by a considerable fall in the arrival of the commodity from the upcountry markets where some leading stockist may be holding back their unsold inventories”, brokers said.

Dealers said despite reports of sufficient wheat stocks in official storage houses and steady release of quota to flour mills, the steep increase in the prices was not warranted by supply and demand factors.

There, however, was a relative quiet on the sugar front followed by reports that the government has directed the Trading Corporation of Pakistan to purchase 0.3 million tonnes of the commodity from the mills to build up a buffer stock and export if prices were competitive.

Prices are expected to fall from the current high levels as the millers have agreed to resume their new crushing season from November 15. The arrivals of new crop are expected to pull down the prices.

On other essential counters, pulses remained under pressure owing to the oversupply and fall in demand. Even gram whole and gram dal, which are widely used in different dishes during the holy month of Ramazan remained cheaper.

Rice remained stable around the previous levels as the new crop situation is still not clear in the backdrop of the pest attack in some areas of the Sindh rice belt. Arrivals of new crop Irri were fairly steady, which in turn did not allow any major changes in the ruling prices.

Pakistan has exported a substantial quantity of gram to India and some other countries to dispose of surplus after meeting the home demand.

On the pulses counter masoor, peas, gram and beetle fell by Rs20 to 60. The biggest fall of Rs150 being again in masoor dal, while gram whole and other varieties were marked down by Rs40 to 55.

Rice sector on the other hand showed mixed trend amid active trading followed by the reports of steady new crop arrivals from the Sindh markets.

Basmati, both sela, kernel and Irri came in for modest support but most deals were finalized at previous levels amid active trading.

Irri-broken type was an exception which fell by Rs5 on the late selling.

On the sugar counter, sugar white was held unchanged, while desi sugar and gur were quoted lower on selling followed by the arrivals of new crop. Both fell by Rs100 to 180.

Cereals showed firm trend as prices of bajra were quoted higher by Rs15, while maize rose by Rs10. Jowar suffered a fresh decline on selling followed by the reports of larger new crop arrivals. Barley followed them in the absence of export demand.

Oilseed sector turned mixed followed by the reports of increase in arrivals.

Rapeseed posted a decline of Rs30, while cottonseed and til were marked higher by Rs25 to 150 on active foreign demand.

Oilcakes also showed mixed trend, while rapeseed cakes rose by Rs2 to 3. Cottonseed cakes eased by Rs10 to 12 on steady arrivals from the oil mills.—M.A