KARACHI, Dec 18: Trading activity on the cotton market on Saturday remain at the lowest ebb as spinners withdrew to sidelines anticipating fall in lint prices in the backdrop of higher than expected arrivals of phutti into the ginneries.

"The latest arrival figures at 11.174m bales have altogether changed the near-term price outlook", says a leading analyst "spinners and mills, who were aggressive buyers kept to the sidelines awaiting the ginner reaction to the latest figures".

According to latest arrival figures for the fortnight ended Dec 15, 2004, another 1.7 bales were added to the previous total of 10.008m bales, out of which 8.9m bales have been purchased by mills and 0.983m bales by TCP, leaving a large unsold stock of 2.330m bales with the ginners.

"The crop figure is not only good for the grower or the industry but also for the country", cotton analysts said adding "an expected final total figure of 14m bales means an addition of Rs50 billion to the national exchequer calculated on the cost basis".

While an air of optimism prevails among the spinners and mills, ginners were a bit worried because of higher unsold stock which may trigger panic-selling by some of their members fearing further fall in prices, market sources said.

But the TCP is there, which could launch a rescue operation to bail out them from the negative fall-out of the production glut, although it has already purchased over 2m bales and its total tally could rise to 4m bales by the end of the season.

The next couple of sessions will show how the market react to the larger than expected arrival figure and until then ready off-take remain slow as both buyers and sellers will watch further developments rather than going for a big kill, brokers said.

Meanwhile, the TCP has received a highest bid of 39.59 cents per lb from a foreign buyer for 10,000 bales against its recently floated tender for the sale of 25,000 bales.

Official spot rates were upped by Rs25 per maund in line with the previous rates but not many dealers were reported around this or lower prices.

New York cotton futures on the other hand posted a fresh gain of 0.67 and 0.59 cents at 44.13 and 44.08 cents per lb for both the ruling March and forward May settlements respectively.

The following are some of the deals reported on late Friday evening.

SINDH TYPE: 2,200 bales, upper Sindh at Rs1,935-1,950, 1,400 bales, Sanghar at Rs1,580-1,825, 200 bales, Mirpurkhas at Rs1,600.