02 January 2005	Sunday	20 Ziqa'ad 1425

KARACHI, Jan 1: Cotton market opened the new year account on a firm note but physical business remained at low ebb as spinners were not inclined to make fresh commitments at the higher asking prices.

The other inhibiting factor was reports of increased moisture content in the newly pressed bales because of recent heavy rain in the entire cotton belt, floor brokers said.

Although ginners take steps well in advance to protect the pressed bales by storing them in their godowns, spinner fears that some of them may be in the open plinths as rain started at night, they said.

Spinners, therefore, expected to keep to the sidelines for another couple of sessions and may not opt for big-lot business until they are sure that the lint in trade is not soaked in rain water and its micronaire is according to their quality standard, some others said.

However, ginners claim they pressed bales lying in their ginneries are fully protected from rain water and there is no question of their being contaminated. The absence of spinners and mills from the market may be for some other reasons.

Market sources said spinners are awaiting the latest arrival figures for the fortnight ended Dec 31, as the figures would give a fair idea of the total crop and spinners are expected to base their future line of action on them.

But they predicted spinners and mills are expected to resume their new year buying by the next week as by that time they will have full idea of their inventories and future needs to see the year through.

Meanwhile, reports coming from the cotton belt indicate that arrivals of phutti into the ginneries have fallen to a modest proportions because ginners are not accepting fresh supplies followed by predictions of fresh rain.

According to ginners some of the leading growers are holding back their unsold stocks to get higher prices and have raised their asking prices slightly above the official support rate of Rs925.

Official spot rates were, therefore, firmly held at the previous levels amid light trading.

New York Cotton Exchange remained closed for new year holiday but reports originating from the private agencies indicate prices are steady because of pent-up speculative demand.

Ready business was light totalling about 7,000 bales, mainly from the upper Sindh and southern Punjab cotton belt and changed hands between Rs1,950 to Rs2,000.