18 May 2004	Tuesday	27 Rabi-ul-Awwal 1425

KARACHI, May 17: Physical trading on the cotton market on Monday modestly picked up as a section of spinners resumed covering purchases after the release of final crop figures by the Pakistan Cotton Ginners Association (PCGA).

According to official arrival figures, the increase was modest and in no way affect the overall supply position. The total final figure was placed at 9.792m bales as compared to the previous 9.770m bales.

Out of the total spinners and mills have purchased 8.8m bales, leaving an unsold stock of 0.794m bales with the ginners. "The unsold stock is too small to bridge the supply gap", brokers said "spinners have to go to foreign supply sources again before the new crop arrives".

The spinners and mills had already imported about 1.3m bales of lint since last year after the reports of damage to the standing crop started trickling in late last year and may need another 1.5m bales to meet their annual consumption needs, dealers said.

The price future outlook, however, remained steady as ginners having a fair idea of the size of the final figure tried to sell low-mic lint at much higher rates. Ginner price perceptions of beyond Rs3,100 per maund level appear to be on the higher side in the backdrop of highly volatile world markets owing to higher crop ideas.

According to latest world production and consumption estimates, the total output could surpass the demand by about a million bales after several lean years and that could be the major restraining factor behind any fresh price flare-up.

However, there is no denying the fact the local supply and demand factors will continue to have positive impact on the local prices but possibly not beyond the current levels, dealers said.

Official spot rates for an average quality of lint were maintained at the weekend levels, although some of the deals were done well above them depending on quality. Ready off-take was moderately active as till late in the evening about 3,000 bales changed hands as under:

SINDH TYPE: 600 bales, Sarhari at Rs3,000 (seed stuff), 400 bales at Rs2,910, 1,000 bales, Rohri at Rs2,900 and 200 bales, Sanghar, low-mic at Rs2,590.

PUNJAB VARIETY: 200 bales, Haroonabad at Rs2,935 and 600 bales, Samundari at Rs3,150.