KARACHI, Feb 22: Trading on the cotton market on Tuesday remained insipid as spinners and mills are not inclined to go beyond Rs2,250 per maund, while ginners are holding on to their unsold positions rather than lowering their asking prices.

"Unlike the previous seasons, the unsold stock of about a million bales is normal and in line with holding capacity", claims a leading ginner "we are alarmed after the total of unsold stock crosses the 2m bales mark".

Moreover, there is no harm in holding on to unsold positions in the backdrop of predictions of an imminent price flare-up, some others said. "There is absolutely no pressure on our liquidity as most of us have already cleared the outstanding payments of growers and the leftover stock is mostly held by the holders," they said.

According to rough market calculations 0.1m bales of lint cotton is valued at Rs1 billion and that they bill in running finance as spinners lift modest quantities daily, which enable us to maintain cash inflow, some leading ginners said.

Although spinners and mills have increased the intake of polyester fibre to produce blend yarn and cloth for export markets, spinners still need about 2.5m bales plus to meet their annual consumption demand before the arrival of new crop from the lower Sindh ginners by late July or early August.

"Spinners and mills have curtailed their daily intake to keep prices below Rs2,300 and so far they are on the winning side as most of the deals were being done between Rs2,150 and Rs2,250 per maund", market sources said.

However, talk of lower arrivals of phutti for the fortnight ending Feb 28, do worry them, which in turn could push prices higher from the current levels, which have almost stabilized around these levels, they said.

Official spot rates were again held unchanged at the overnight level, although some deals in the ready section were done above them. Ready off-take was light totalling about 4,000 bales, the following being some of the notable deals: 1,000 bales, Shahdadpur at Rs2,150, 2,000 bales, uppers Sindh at Rs2,250 and 500 bales, Chichawatni at Rs2,150.