June 25, 2007	Monday	Jamadi-us-Sani 09, 1428

TRADING activity on the Karachi wholesale commodity markets last week was relatively slow as consumers were reluctant to buy at the rising prices amid expectations that fresh arrivals from upcountry centres may ease supply position.

Much of the price flare-up was noted again in the pulses sector, which has been dormant for the last couple of weeks ahead of the budget. But the post-budget trading witnessed another price spiral.

Although arrivals from upcountry markets showed improvement over the week, prices of essential items stayed on the higher side as stock holders were not inclined to loosen their grip on prices, floor brokers said.

Much of the activity remained confined to counters of essential items and some type of cereals, while industrial raw materials showed fractional changes as supply position remained fairly comfortable, dealers said.

Prices of wheat and some varieties of pulses showed increase despite reports of higher yield as local supplies remained under pressure as commercial houses firmly held the price line according to their own whims, they added.

But fresh rise in wheat prices was not backed by objective conditions, including ban on exports and a record crop of 23.5 million tons, excepting the squeeze applied by speculative traders on the supply line, dealers said.

According to them some leading stockists are building up long positions after having cornered floating stock at the higher prices combined with forward buying by the flour mills keeping wheat prices on the higher side.

Private sector exporters of wheat are also worried over the developing situation on this front as they may not remain competitive on the world markets after the lifting of ban on exports as by that time local prices may rise further, they said.

Rice sector, which has been dormant for the last couple of weeks on reports that stocks of old crop had exhausted, again turned active as exporters opted for fine varieties of basmati, including sela and kernel.

There was a relative quiet on the IRRI front, but basmati varieties were keenly sought by exporters and in the process prices rose sharply higher under the lead of sela type, which was marked up by Rs300 to Rs400 per bag.

Fresh export deals with the Gulf and some European countries was said to be the chief inspiring factor behind the current price flare-up, which have touched all time highs by now, dealers said.

Almost all varieties of imported pulses showed sharp increase owing to reported pressure on ready supplies. Gram whole, peas, masoor, masoor dal and beetle were prominent among them, which were quoted higher by Rs75 to Rs200 per bag.

Rice followed them under the lead of basmati, which was quoted higher by Rs200 to Rs400 per bag followed by sela type, up by Rs200, except IRRI-6 which showed a modest rise of Rs25.

On the other hand IRRI-6 broken and basmati broken suffered fall ranging from Rs275 to Rs280, the largest fall being in basmati broken. Kernal type also eased from the recent higher level.

Among other essential items, wheat showed a fresh increase of Rs20 as local stockists held on to their stocks causing artificial shortage on the market and the consequent increase in prices.

Sugar prices were held unchanged, but desi sugar rose by Rs200 per 40 kg, while gur fell by Rs100 amid active buying by the agents from Afghanistan, one of the major consumers of both the items.

Cereals showed divergent trend. While maize was quoted further higher by Rs75 per maund on active local demand, bajra fell by Rs25.

Oilseed section did not show much change as prices of major seeds, including cottonseed, rapeseed, castor seed and til were again held unchanged as supplies matched the demand.

Oilcakes lacked normal trading interest and were quoted lower by Rs10 to Rs20 for rapeseed and cottonseed cakes respectively on selling by the stockists.—M.A.