March 31, 2006	Friday	Rabi-ul-Awwal 1, 1427

KARACHI, March 30: Cotton market on Thursday showed quietly steady trend as official spot rates were again firmly held around the previous levels for the fifth session in a row despite revival of mill demand.

But in physical trading the selling prices widely fluctuated depending on the quality of lint in trade and staple length, dealers said, adding for instance, some of the lots were sold at Rs2,325 per maund while fine lots at Rs2,475.

“The quality war seems to be gaining momentum as it generally occurs towards the closing of the season”, says a leading cotton analyst, adding “some of the mills and spinners, who have made forward deals for fine cloth and yarn, need quality cotton irrespective of the asking prices”.

The prevailing wide varietal gaps reflect this phenomenon but spinners are now seem to be in no mood to keep to the sidelines and have turned active buyers overnight, he added.

Floor brokers also held the same view and predicted heating up of the local market after Friday’s TCP tender for the sale of 50,000 bales as mills were not inclined to await another tender.

The local market, which still holds an unsold stock of over a million bales, could well prove a fighting arena between the ginners and the spinners followed by a modest rise in prices, they said.

But some others said the TCP’s selling prices could have a negative impact on the local market if it accepted lowest bids from the foreign buyers and that was perhaps why leading spinners were eyeing the bidding date so that they could decide their future line of action.

Meanwhile, reports coming from the lower Sindh cotton belt show that the growth of the new crop, which is currently in the bolling stage, is good and picking could start sometime in late May or early June.

Official spot rates, therefore, remained basically unchanged from the previous levels at Rs2.425, while in the ready section rates varied.

New York cotton futures on the other hand showed a modest rise of 0.25 and 0.19 cents at 53.16 and 54.74 cents per lb for both the ruling May and the distant July contracts.

Ready off-take was modest totalling about 10,000 bales the following being some of the notable deals: 4,000 bales, K-68 Sawgin, Gothki, Dharki and Mirpur Mathelo at Rs2,400 to Rs2,435, 1,100 bales, Haroonabad and 2,000 bales, Rajanpur at Rs2,325 and 1,000 bales, Rahimyar Khan at Rs2,475.