July 23, 2006	Sunday	Jumadi-ul-Sani 26, 1427

KARACHI, July 22: Cotton prices on Saturday remained stable around the previous level as ginners held on to their unsold positions rather than selling below their parity levels.

After having purchased 14,000 bales from the TCP in its recent auction at Rs2,362 and Rs2,423 per maund depending on the quality of lint, spinners and mills remained conspicuous by their absence in an apparent effort to outwit ginners on the price front, said Naseem Usman, a leading floor broker.

But ginners appeared to be in no obliging mood and did not lower their asking prices on the perception that spinners, who were terribly short of their annual consumption needs of lint, might have to resume normal buying operations possibly by next week, he added.

“The spinner euphoria of additional supplies from the TCP is fading out each day,” says a leading ginner. “We are waiting for the return of the prodigal son any time.”

The new crop supplies both from lower Sindh and central Punjab were too meagre to meet the daily mill intake and imports around 52 cents per lb were too expensive to compete in the textile export market, he added.

Both the current and new crops below Rs2,500 or slightly above for fine lint per maund are in line with the export parity level of the spinners and mills and they have to opt for the local stuff during the next couple of weeks.

According to spinner sources, the textile sector needed well over 0.1 million bales of lint each month to keep the wheels of the industry moving and indications were that their annual intake could touch the high mark of 1.5 million bales.

Meanwhile, reports reaching here from lower Sindh and central Punjab cotton belts indicate that arrivals of phutti are picking up each day owing to warm weather.

Unconfirmed reports said rate of phutti were also on the rise followed by reports of pest attack in some of the lower Sindh cotton belt, although the damage reported was not that alarming.

Official spot rates were, therefore, firmly held at the last levels, as there was no panic among ginners about the rising unsold stocks. Their holding capacity is said to be fairly strong and they are not inclined to sell below their parity levels.

Ready offtake was light totalling 1,500 bales, both the current and new crops. The highest rate for fine lots was said to be around Rs2,500 per maund, while new crop lots were mostly sold at around Rs2,400 depending on quality of lint.