06 April 2004	Tuesday	15 Safar 1425

KARACHI, April 5: An active trading was witnessed on the cotton market on Monday as spinners and mills made near-panic covering purchases amid reports of falling unsold stocks with the ginners.

About 15,000 bales changed hands, mostly from the Punjab ginneries, which also include some big-lots, reflecting the presence of leading groups in the market after the absence of last couple of weeks.

A price differential of about Rs600 per maund in the selling prices of low-mic and fine quality lint reflects that the spinners and mills are out to replenish their stock positions against forward sales.

Although arrival figures of phutti released by the Pakistan Cotton Ginners Association (PCGA), for the fortnight ended April 1, were slightly higher at 9.750m bales as against the comparable figure last year, the spinners were not inclined to take risk as the unsold stocks at 1.231m bales are too low to meet even their partial demand, dealers said.

The spinners and mills, according to the figures, had purchased 8.340m bales as compared to last year's 8.884m bales during the same period, which could well mean they would need another 2.5m bales to see the current season through. Their total annual consumption demand is 12m bales plus.

"The spectre of supply and demand in the backdrop of higher world prices haunt them," says a leading broker, adding "prices could move again higher if spinners opted for panic buying to corner the floating stock."

The total crop is expected to touch the high mark of 10m bales until the final arrival figures reached the market, but the supply gap is expected to give ginners a breathing space to lower their losses, he adds. A section of ginners holding stray stocks appears to be on their way after liquidating their stocks irrespective of the offered prices, he said.

Official spot rates resisted fresh decline as bulk of the ready business was finalized in line with them depending on quality. Ready offtake was active as about 15,000 bales, changed hands, following being some of the notable deals, all in Punjab varieties: 500 bale, Sadiqabad at Rs2,425; 400 bales, Rajanpur at Rs2,850; 1,000 bales, each from Bahawalpur and Samandri at Rs3,000 and Rs2,900, respectively; 200 bales, Samandri at Rs2,850; 200 bales, Khanpur at Rs2,900 and 200 bales at Rs2,950; 4,000 bales, Shujabad at Rs3,000; and 2,200 bales, Vehari at Rs2,850.