30 January 2005	Sunday	19 Zilhaj 1425

KARACHI, Jan 29: The cotton market finished the weekend session on an easy note as official spot rates were lowered by Rs25 in line with those at which physical business is being transacted for the last couple of sessions.

But these rates are of an average quality lint, while fine varieties continue to fetch higher price at around Rs2,100 to Rs2,150 per maund, dealers said.

Physical business, however, shrank to modest proportions as both sellers and buyers kept to the sidelines apparently awaiting the negative fallout of steep decline in New York cotton futures, they said.

For the last two sessions, New York cotton futures have suffered strong speculative selling triggered by reports of higher US crop ideas and a considerable decline in global demand.

"I don't local market will be affected by the bearish developments on the New York Cotton Exchange," says a leading cotton broker. "Prices here are mostly being guided by supply and demand factors rather than any negative developments elsewhere."

He said the presence of TCP in the market, despite the fact that it has already surpassed the official procurement target of 2.5m bales, continues to impart needed strength to the market.

The perception is that the TCP could re-enter the market any time if lint prices fell from the competitive rates for both the ginners and spinners, he added.

Meanwhile, most of the leading spinners and mills have slowed down their daily intake apparently awaiting the arrival figures of phutti for the fortnight ending Jan 31.

The last official arrival figure put the total at 13.761m bales, out of which mills intake amounted to over 10m bales and they may need another 0.3m bales to cover their annual consumption needs.

The PCGA figures for the current fortnight will give a fair idea of supply and demand, according to which buyers and sellers will base their future planning but indications are that future supplies will be normal and at competitive rates, market sources said.

New York cotton futures suffered fresh fall of 0.51 and 0.53 cents per lb at 43.35 and 44.54 cents for both the ruling March and the distant May contracts, respectively.

Ready offtake was light totalling about 2,000 bales as under: 400 bales, Sanghar at Rs2,000; and 800 bales, upper Sindh at Rs2,125. Stray business was also reported in southern Punjab lint but details were not immediately available.