KARACHI, May 31: Physical business on the cotton market on Saturday was light as spinners and mills made selective buying mainly of premium lots, the highest rate being Rs4,000 per maund, floor brokers said.

“Spinner hopes of cheaper lint are fading each day as despite lower world prices, local one remained expensive owing to short supply,” they said.

Some of the leading exporters, who had surplus lint purchased early in the season at much lower rates, preferred to sell their stocks to the local mills as according to them local rates are higher than their export parity levels and ensure fair profit margins, they said.

“Why should we opt for the lengthy process of export business, that too, at the lower levels, while out stocks fetch more than reasonable prices being offered by the spinners and mills,” they added.

New York cotton futures on Friday again showed divergent trend. While the ruling new crop July settlement ended further lower by 0.25 cents per lb at 65.74, the forward October contract rose by 0.32 cents and stood firm above the benchmark of 70 cents per lb at 71.16 cents.

According to official figures the exporters have registered, up to May 23, forward export contracts with the Trade Development Authority of Pakistan (TDAP) totaling 0.257m bales, both from the previous and the current crop and had physically shipped 0.235m bales against the total by the same date.

Floor brokers said the lint market is in the tight grip of the ginners owing to falling unsold stocks, who are firmly holding on to their positions amid hopes that prices could rise further in the post-budget trading sessions.

Spinners and mills are very much in the market, although they have curtailed their daily intake because of higher prices, they added.

Official spot rates were held unchanged at the overnight level of Rs3,700 but most of the deals in the ready section were done well above them.

The following are some of the lots, which gone through: 600 bales, Lodhran at Rs4,000, 800 bales, Noorpur and 400 bales, exporter to mill at Rs3,800 and 400 bales, Sanawa at Rs3,900.