KARACHI: Trading on the cotton market resumed on a dull note as both spinners and mills kept to the sidelines apparently calculating overhead costs on import of Indian lint as compared to the local stuff.
The activity also remained slow as spinners and mills are still haunted by delivery problems amid fears of law and order situation in the backdrop of last Saturday’s killing and Monday’s general strike.
But some analysts said the steep decline in New York cotton futures on Monday has altogether changed the import look and spinners will await further developments on the world markets before entering into forward deals with the Indian importers.
New York cotton futures fell to new seasonal lows of 46.92 and 50 cents per lb for both the ruling July and the distant October settlements respectively, off 1.19 and 1.15 cents per lb.
“We have to take into account the current fall in New York cotton futures on selling prompted by higher US crop ideas and a considerable fall in demand from the major importers,” said a leading spinner.
Imports of lint from India will be viewed in the developing perceptions and “we will not opt for panic buying,” he added.
It was perhaps in this background spinners and mills did not make fresh commitments anticipating further decline in local prices and “we have to decide, which lint is in line with our export parity level,” some others said.
Meanwhile, reports reaching here from the lower Sindh cotton belt indicate that newly sown cotton is progressing well and the growth is normal and there are no reports of pest attack in any of the areas because of extremely hot weather.
Sowing of the new crop in the other major cotton growing areas is well in progress and growers intend to complete the entire sowing operations by the official deadline of June 15.
Official spot rates were again held unchanged at the previous level of Rs2,675 per maund but no deal was reported in the ready section till late in the evening although some of the ginners lowered their asking prices.
