04 January 2004	Sunday	11 Ziqa'ad 1424

KARACHI, Jan 3: Physical trading on the cotton market on Saturday shrank to modest proportions despite panic mill buying as ginners held on to their unsold positions anticipating further increase in prices.

After several lean sessions, spinners and mills indulged in big-lot business to grab the floating stock and some big lots changed hands at Rs3,300.00 and Rs3,400 per maund without 15 per cent sales tax.

The mill demand is expected to gather fresh momentum after the New York opening around 75 cents per lb or slightly above, which in turn could raise local prices further higher, dealers said.

The latest bull-run on the cotton market was attributed to market talk of lower arrivals of phutti into the ginneries for the fortnight ended Dec 31, dealers said.

According to unofficial sources the current figure showed an increase of about a million bales over the previous at 8.4m bales as compared to last fortnight's 7.5m bales.

"What worries spinners and mills are the rumours circulating in the market that the arrivals in the current month may be much lower as being anticipated by them", says a leading broker.

He said the total crop at best could touch the high mark of 9.5m bales and to put the figure beyond this level may be based on speculative thinking.

The sudden increase in mill demand touching the limits of panic-buying may be based on the real supply and demand factors, which according to their own crop surveys are in line with their figures.

The other contributory factor fuelling the current price flare-up is said to be quality war between the mills and spinners as each one among them is out to corner the fine lots irrespective of the asking prices, market sources said.

Meanwhile, physical shipments against forward sales of 0.122m bales were maintained on the higher side as up to Nov 30, 2003, 86,000 bales, have been shipped to various destinations.

The following is month-wise breakup of shipments during the current crop year, starting from Aug 3, 6,647 bales, September 6,235 bales, October 35,582 bales and November 37,524 bales.

Official spot rates were further raised by Rs50 per maund at Rs3,325 in line with those at which ready business is being transacted.

Ready offtake was light totalling about 15,000 bales, the following being some of the notable deals: 1,600 bales, Muridwala, at Rs3,050, 5,400 bales, K-68, upper Sindh at Rs3,350 to Rs3,400, 4,000 bales, Rahimyar Khan at Rs3,300 to Rs3,400, 1,000 bales, Sadiqabad at Rs3,300 to Rs3,350 and 1,000 bales, Haroonabad at Rs3,300.