KARACHI, Aug 25: Physical activity on the cotton market on Saturday was fairly active as spinners and mills continued building up long positions at the current levels.

Another 10,000 bales both from the Sindh and the Punjab cotton belts changed hands around the overnight lower rates as spinners were not inclined to take risks in a highly volatile market being guided by supply and demand factors, market sources said.

“Our export parity level is around Rs2,800 to Rs2,850 per maund but we are paying higher price for the lint amid fears of another price flare-up,” said a spinner.

The recent rain has brightened the crop prospects as reports reaching here indicate that the mealybug pest, which had attacked the standing crop in some areas, has been washed away by the recent rain, he said.

A substantial increase in arrivals of phutti into the ginneries and subsequent fall in lint prices shows that the position of the new crop in the major growing areas is satisfactory, he said.

Phutti prices have declined to Rs1,300 and Rs1,425 per 40 kg and that of lint at Rs2,925 to Rs2,975 per maund for the Sindh type and Rs3,125 to Rs3,150 for the Punjab variety.

“The market remained in the tight grip of the growers who regulated prices by holding back their stock, while both ginner and the spinner remained at the receiving end,” said cotton market analyst Naseem Usman.

He said snap increase in arrivals of phutti seemed to have changed the entire crop outlook and there could be many pleasant surprises about the production figure next month.

Official spot rates were again held unchanged at Rs2,925 per maund but in the ready section most of the deals were again finalised at much higher rates.

The following deals were done on Saturday: 1,000 bales, Tando Adam at Rs2,900 to Rs2,975, 400 bales, Mirpurkhas at Rs2,925 and 600 bales, Shahdadpur at Rs2,950 to Rs2,975.

About 4,000 bales, from various Punjab stations including Burewala, Sahiwal and Pakpattan were done between Rs3,125 to Rs3,150 per maund.