KARACHI, Jan 4: Cotton market on Tuesday showed steady trend as spinners and TCP continued to build up long positions at the current levels apparently to absorb the negative fallout of the bumper crop. There was, therefore, no immediate bearish impact on the prevailing prices despite larger than expected arrival figures of phutti into the ginneries.

According to latest arrival figures released by the Pakistan Cotton Ginners Association (PCGA), over 13.102m bales had arrived into the ginneries for the fortnight ended on Dec 31, 2004, as compared to 11.745m bales during the previous fortnight, up 1.357m bales.

"The total crop could be 14m bales plus," surveys conducted by some of the private cotton crop monitoring agencies reveal "there could an exportable surplus of about 2m bales after meeting the local demand".

Majority of cotton analysts believe prices are expected to remain steady owing to strong mill demand and a contributory positive role being played by the TCP as a second buyer.

Bulk of the total has already been purchased by mills and spinners, leaving an unsold stock of 2.148m bales with the ginneries. According to latest figures released by TCP, it has contracted to buy 2.479 bales of lint both from the Sindh and the Punjab ginners, out of which 1.246m bales have already arrived in its godowns. Spinners have purchased 9.5m bales, out of the total.

That was perhaps why post-arrival figures market remained fairly steady as ginners know that spinners and mills have still to go a long way to cover their forward positions against rising exports, brokers said.

On the export front, private sector exporters are active as up to Dec 31, 2004 they had made forward sales of 0.447m bales and are in the process of covering their positions.

Official spot rates were firmly held at the previous levels, while in the ready section most of deals were based on quality. Ready off-take was active totalling 20,000 bales, the following being some of the notable deals.

SINDH TYPE: 4,000 bales, Gothki, Dharki, Panu Akil and Mirpur Mathelo at Rs2,000, and 1,000 bales, Shahdadpur at Rs1,750-1,775.