KARACHI, July 4: Trading on the cotton market on Monday resumed on a sluggish note as spinners and mills remained conspicuous by their absence awaiting the outcome of bids against the TCP lint auction for well over 0.9m bales. Although there was no official word on the sale proceeds or the rate for various categories of lint on sales, unconfirmed reports said most of the buying offers from the local buyers were accepted by the TCP as their rates were in line with its reference price, brokers said.

However, during the previous auctions spread over two months, spinners and mills have purchased bulk of the lint and according to market sources, their total purchases from the TCP have touched the high mark of 0.4m bales.

Spinners and mills prefer local lint procured by the TCP because of its fine quality, which need both for blending purposes with the polyester fibre and to produce higher counts of cotton yarn for the export markets, dealers said.

Out of the total local crop of 14.347m bales, spinners and mills have already purchased 11.872m bales, and need more supplies because of higher export orders at competitive rates, they said.

But foreign buyers again failed to match the TCP benchmark prices as they bid keeping in mind the New York cotton futures, which are claimed to be below its reference price, they said.

The highly volatile price movements on the New York futures market has a negative bearing on the local sales of the TCP but analysts said local prices are still lower than the foreign ones and some of the foreign buyers are lifting modest lots to supplement their supply lines, they added.

Owing to its medium staple length, the local lint is sold at a discount of four to five cents per lb as compared to foreign stuff and if its reference price is higher foreign bidders generally don’t match their bids to that of the TCP.

Official spot rates, therefore, did not show any change and were firmly held at the last levels in the absence of feedback from the ready section.

Ready business remained slow, although some brokers claim stray business is being done between the spinners and ginners details of which are not readily available from them.