23 March 2004	Tuesday	01 Safar 1425

KARACHI, March 22: Physical trading on the cotton market on Monday remained dull as spinners were not inclined to make fresh commitments ahead of Tuesday's closure on account of Pakistan Day holiday.

In the backdrop of last Saturday's some big-lot business, leading spinners and mills preferred to keep to the sidelines because of delivery problems. Ginners said mills were extending guarded support and mostly in line with their export parity levels amid hopes that local prices could further ease in response to international prices.

The reports of five per cent increase in its textile import quota for a number of categories by the European Union should have accelerated the pace of forward buying by the spinners but they did not react that way, they said.

"The highly erratic price movements of New York cotton futures during the last couple of weeks have a negative impact on the local prices as the ginners are quoting their selling prices according to them," some spinners said.

"We can't make long-term planning on the export front as uneven local prices cause serious problems for us to meet export commitments well in time," they said. Already, some of the spinners have honoured their export commitments at a loss as lint prices have risen sharply higher for the quarter ending March 31, 2004.

However, some of the local mills, whose stock position was not that strong were in the market and made fresh enquiries, but owing to higher asking prices ready offtake remained light, brokers said.

Reports coming from the southern Punjab cotton belt were, on the other hand, fairly encouraging as leading spinners from Punjab covered positions against their forward sales at an average rate of Rs3,000 per maund, excluding 15 per cent sales tax, they added.

Official spot rates were, however, firmly held at the weekend levels, although some of the deals reported in the ready section were finalized depending on the quality premiums.

Ready business was light as till late in the evening about 3,000 bales, mostly from the central Sindh and southern Punjab cotton belts, changed hands at Rs2,700 and Rs2,800 per maund, without 15 per cent sales tax.