22 April 2004	Thursday	01 Rabi-ul-Awwal 1425

KARACHI, April 21: Cotton market on Wednesday again showed a firm trend as spinners made fresh selective covering purchases in an effort not to allow further increase in prices.

Spinners and mills remained in the market for the last three sessions but it seems that they have decided to operate in unison with a sole objective of "not to allow further increase in prices," brokers said. "But to buy at dips and withdraw to the sidelines if ginners raise their asking prices," this appears to be a consensus move by the spinners and mills. "The light ready volume points to this phenomenon."

Some of the fine lots, which came in for trading were done between Rs2,800 and Rs3,000 per maund indicating that ginners are cashing in on the falling unsold stock of a million bales, dealers said.

The interesting feature was that some of the mills were indulging in big-lot business in apparent effort to grab the floating stock of fine lots at the prevailing prices, they said.

Some leading brokers fear a standoff in the ready business as the recent decline in New York cotton futures may not allow ginners to adjust their selling prices to international levels.

Indications are that from now onward ginners will operate keeping in view the supply and demand factors and may not follow the rise or fall on the New York Cotton Exchange, market sources said. "The size of the crop is below the target and ginners are speculating further increase in local prices rather than decline," they said.

Meanwhile, reports coming from the major crop areas indicate that sowing of the new crop is expected to start by the middle of the next month and will be completed in a month's time.

New York cotton futures closing on Tuesday failed to maintain their upward drive and fell by 0.71 and 0.87 cents per lb at 61.50 and 61.84 cents for both the ruling May and the forward July settlements respectively.

Local official spot rates on the other hand posted a fresh rise of Rs25 at Rs2850 per maund in line with higher prices at which ready business was done. Ready business was modest amounting to about 5,000 bales as under: 400 bales, Kumb at Rs2,800 and 1,500 bales, Liaquatpur at Rs2,900 and 1,600 bales, Khanpur at Rs3,000.