03 April 2004	Saturday	12 Safar 1425

KARACHI, April 2: The cotton market on Friday passed through another dull trading session as buyers and sellers kept to the sidelines, watching developments on the world cotton front.

While spinners' absence from the market is attributed to violent bearish price movements on the New York futures market and hopes of an identical fall in local rates, ginners were worried over the sudden change in the world price outlook, dealers said.

But the ginners are in no mood to get panicky and are holding on to their positions and may not lower their asking prices for the fine lots owing to parity levels in relation to phutti.

Some of them are holding stray lots of low-mic lint while others are getting out of their unsold positions after selling at a bit lower rates, dealers said.

For the second session in a row, New York cotton futures suffered fresh pruning of 57 cents per lb for the ruling May settlement amid predictions of further decline as speculative selling could further intensify in the sessions to come followed by higher crop projections, both in the US and China, they said.

Local spinners are watching the changing world cotton scenario with interest as the price movements are progressively tilting in their favour, says a leading broker, adding "but whether or not they remain competitive on the world yarn market amid falling lint prices is yet to be ascertained."

However, leading spinners think any further decline in New York cotton futures could benefit them. "The fall of the May settlement below the 60 cent per lb mark could enable us to balance our inventories purchased on an average rate of 64 cents per lb during the last couple of months."

The spinners have so far imported about 0.7m bales of lint from various foreign sources to make up an expected local crop shortage and may need some more supplies to see the current season through, brokers said.

Official spot rates were firmly held at the last levels in the absence of falling ready business, but dealers said they fell after normal trading resumes.

Ready offtake was light and confined to low-mic lots, totalling about 2,000 bales as under: 400 bales, Sadiqabad at Rs2,550 and 1,400 bales at Rs2,400 per maund without 15 per cent sales tax.