KARACHI, May 22: Trading activity on the cotton market on Tuesday failed to pick up as spinners and mills kept to the sidelines apparently awaiting the arrival of imported stuff into their ginneries.
Spinners appear to be in a bit hurry as their entry into the world markets has caused a price flare-up the world over, notably on the New York Cotton Exchange where future contracts have persistently risen and are being quoted well above the 50-cent benchmark rates, ginners said.
New York cotton futures a couple of weeks earlier had breach through the barrier of 50-cent for the recently rung off May contract, the said.
“Foreign lint above 50-cent per lb mark is a bit expensive and adds to our production costs,” said a leading spinner, adding “but we have to go by the prevailing market conditions”.
However, it was not in line with the existing market conditions and their continued absence indicates that they are getting cheaper imported stuff as compared to the local prices being quoted by the ginners who still hold modest unsold stocks, market sources said.
But some others said spinners and mills were making direct purchases from the ginners details of which probably were not sent to the Karachi Cotton Association (KCA).Meanwhile, reports about fresh rains in specified areas indicate that some growers would resume sowing in couple of days.
The recent rain however is beneficial for the earlier sown cotton, notably in some part of the lower and central Sindh cotton belt, some ginners said.
Official spot rates were held at the overnight level of Rs2,650 per maund in the absence of any feedback from the ready section about the ruling price.
New York cotton futures on the other hand were quoted further higher by 0.78 and 1.10 cents per lb at 50.54 and 53.80 cents for both the ruling July and forward October contracts respectively.
