November 20, 2003	Thursday	Ramazan 24, 1424

KARACHI, Nov 19: Cotton prices on Wednesday again rose from the overnight lower levels followed by panic mill buying triggered by conflicting reports about the size of the final crop.

An idea of panic mill and spinner buying may well be had that they lifted about 40,000 bales, mostly of fine lots at the higher rates ranging from Rs3,250 to Rs3,300 per maund, without 15 per cent sales tax.

Late on Tuesday, lint prices have declined to Rs3,200 for the Punjab type and Rs3,050 for the central Sindh variety.

The interesting feature was that the renewed price flare-up was caused despite higher arrival figures of phutti into the ginneries and steep decline in New York cotton futures, which had again fallen by limit-losses.

“The local prices are now essentially guided by the local supply and demand factors, external positive or negative factors having a little relevance to the ground situation”, says a leading broker who recently toured the Punjab cotton belt and has a fair idea of the total crop.

“The total crop may not touch the high mark of 9.2m bales”, he claims official estimates notwithstanding “the negative impact of the crop damages caused by the late pest attack will be visible in the arrival figures of Dec 15”.

Heavy mill buying reflects that both leading textile and spinning mills by now have a fair idea of the total crop and are not inclined to take even calculated risk in apparent bid to honour their export commitments, market sources said adding and in the process prices could rise further from the current levels.

“The recent limit-decline in New York cotton futures may not pave the way for further erosion”, says a spinner “as the imports are expected to be expensive, we are not inclined to take a risk of further fall at this stage”.

The cotton trade is heading for a major crisis in the coming weeks as pressure on supplies and expensive imports could cause fresh increase in the local prices, he fears.

Official spot rates were lowered by Rs75 per maund in line with the overnight decline in the ready prices but they are expected to be upped on Thursday again.

New York cotton futures fell by limit-fall of 2.87 and 2.27 cents per lb for both the ruling December and the forward March contracts at 71.23 and 76.19 cents per lb respectively.

Ready offtake was large thanks to panic mill buying and about 40,000 bales changed hands till late in the evening, the following being some of the notably big-lot deals mostly from the Punjab ginneries: 5,000 bales, Rahimyar Khan at Rs3,250 to Rs3,300, 3,000 bales, Sadiqabad also at the same rate, 4,000 bales, upper Sindh K-68, at Rs3,300, 3,000 bales, Faisalabad at Rs3,175 to Rs3,200, 2,000 bales, Jehania at Rs3,250 to 3,300, 3,000 bales, D.G.Khan at Rs3,250, 2,000 bales, Sadiqabad at Rs3,250, 2,000 bales, Burewala at Rs3,200, 1,000 bales, Ahmedpur East also at Rs3,200 and 1,000 bales, Chanigoth at Rs3,200 to Rs3,300.