KARACHI, Dec 9: Trading activity on the cotton market on Saturday was on the lower side of the daily average as spinners significantly curtailed the intake apparently to keep prices within the current levels.
“Unlike the previous sessions there were not many big-lot deals, touching the high limit of 5,000 bales as spinners tried to play safe because of higher crop ideas,” floor brokers said.
The 2.25 per cent increase in the arrivals of phutti for the fortnight ended Dec 1, seems to have changed spinner perceptions about the future supplies and they decided to go by the rule of supply and demand, they said.
“The motive behind the slowdown in mill buying appears to be to outwit small ginners to lower their asking prices playing their limited holding capacity,” says a leading ginner, adding “but strong presence of a spinner cartel in the market which is after each fine lot may not allow fall in the prevailing prices”.
That is perhaps why most of the big lots were sold at the seasonal highs. Even some of the quality lots touched the high mark of Rs2,525 per maund, they added.
But cotton analysts said it was too early to speculate about the future price outlook before the phutti arrival figures for the fortnight ending Dec 15, are released by the Pakistan Cotton Ginners Association (PCGA).
They will give a fair idea of the total crop despite fear of fall in the Sindh production figures and its impact on the prevailing prices, they said.
Meanwhile, private sector exporters up to Nov 30 have registered cotton export deals both of the current and the old crop totalling 90,707 bales against which only 10,459 bales have been physically shipped by Sept 6, 2006, according to official figures.
Official spot rates for average quality were, however, again held unchanged at the previous level of Rs2,525.
New York cotton futures on the other hand posted fresh modest fall on speculative trade owing to falling foreign demand. Both the ruling March and May settlements were marked down by 0.33 and 0.24 cents at 52.73 and 54.11 cents per lb respectively.
Ready off-take was light totalling about 15,000 bales as under.
SINDH TYPE: 1,000 bales, Sanghar at Rs2,450-2,525, 1,000 bales, Khairpur and 400 bales Dadu at Rs2,525.
PUNJAB VARIETY: 2,000 bales each Bahawalpur, D.G. Khan and Muhammadpur Dewan, 1,000 bales, Ahmedpur East, 2,200 bales, Jahania, 400 bales, each Tranda, Layyah, 600 bales, Lodhran and 200 bales, Yazman at Rs2,600, 400 bales each Burewala and Chistian at Rs2,550-2,590.
