October 12, 2006	Thursday	Ramazan 18, 1427

KARACHI, Oct 11: Active trading was witnessed on the cotton market on Wednesday as ginners continued to unload their long unsold positions in an uncertain price outlook.

Another 20,000 bales, mostly from Punjab ginneries changed hands between Rs2,375 on the lower side and Rs2,450 on the higher side depending on the quality of lint, dealers said.

Heavy mill buying reflects that the ruling prices are in line with their export parity levels, reflecting some improvement in forward sales on the export front, they said.

“The fall below the benchmark of 50-cents per lb by the New York cotton futures has created more than one problem for the textile sector on the export front,” says a leading spinner. “On the one hand it ensured cheaper prices for our foreign competitors in textiles but failed to have sympathetic negative impact on the local prices on the other hand.”

However, brisk daily mill covering purchases against forward sales did not necessarily reflects fair profit margins on the export front but appears to be an effort recover initial losses after the world prices rise towards the closing weeks of the current season, spinners said.

Meanwhile, reports coming from the cotton belt indicate that picking operations of phutti in the entire cotton belt are in full swing and growers are not holding on to their stocks, market sources said.

Arrival of phutti into the ginneries are also said to be on the higher side and the interesting feature is that all the growers are selling their phutti on cash basis as no one is sure about the future price outlook.

It was in this background that the official spot rates were firmly held at the overnight level of Rs2,400 per maund, although most the deals were done well above them.

New York cotton futures on the other hand remained under pressure and were quoted further lower by 0.36 and 0.22 cents per lb at 48.709 and 52.35 cents for both the maturing October and the distant December contracts, respectively.

Ready offtake was on the higher side as about 20,000 bales changed hands, the following being some of the notable deals:

SINDH VARIETY: 400 bales, each Tando Muhammad Khan and Shahdpur Chakkar at Rs2,375; and 400 bales, Shahdadpur at Rs2,400.

PUNJAB TYPE: 1,000 bales, Pir Mahal at Rs2,450; 1,000 bales, Hasilpur at Rs2,450 to Rs2,500; 1,600 bales, Khanewal at Rs2,475; 1,000 bales, Rajanpur at Rs2,425 to Rs2,450; 2,000 bales, Haroonabad at Rs2,450; 200 bales, each Mongi Bungalow, Jhang, Bahawana, Dera Ghazi Khan, Multan, Fort Abbas, Sadiqabad, Madressa, Pak Pattan and Arifwala at Rs2,450; 400 bales, Bahawalpur at Rs2,475; 400 bales, Burewala at Rs2,450 to Rs2,460; 400 bales, Fazal Pur at Rs2,425 to Rs2,450; 600 bales, Chichawatni at Rs2,460 to Rs2,465; and 200 bales, Sahiwal at Rs2,455.