June 16, 2008	Monday	Jamadi-us-Sani 11, 1429

THE post-budget week on the Karachi wholesale commodity markets witnessed a major price change on the lower side on the essentials’ counter in the absence of demand from general consumers. However, the full impact of the fiscal measures would be known within next couple of weeks.

Hasty selling by stockists, mainly on the rice counter and slack demand from private sector exporters, pushed prices of both IRRI and basmati varieties sharply lower in comparison to the all-time peak levels, analysts said.

Physical activities, however, remained slow as consumers stayed on sidelines anticipating fresh fall in prices after the impact of fiscal steps during the next couple of sessions, dealers said.

Dealers were of the opinion that some administrative steps should follow to keep watch on the price trend on major wholesale markets to keep the post-budget fall in prices of essential items. They fear the upcountry traders may hold back their stocks owing to fall in prices creating artificial shortages to push prices to pre-budget levels.

The decline in rice prices for the second week in a row from the all-time peak levels, reflects that reversal will be accelerated as stockists will try to release their hoarded stocks in part fearing official action, they said.

A relative lull on the export front, after the fixation of minimum export prices for both IRRI and basmati varieties contributed to the decline in rice prices as private sector exporters sold their stocks in the open market in stead of physical shipments because of some procedural problems.

The impact of prime minister’s warning on wheat hoarders was visible on some other essential items also, which were ruling sharply higher, they said.

heat prices, which had gone up to an all-time high of Rs2,215 per bag, showed signs of softening during the post-budget trading and dealers were expecting further decline in its prices.

Pulses and sugar followed them as commercial traders and stockholders liquidated in part their long positions, pushing prices on the lower side.

But some others said a temporary halt in import of pulses as importers would resume it after studying the relevant import trade rules, could cause shortages and price hike.

The market decline was led by the rice sector where prices fell in unison for IRRI, basmati, sela and kernel. The average decline in their prices was between Rs300 and Rs200 per bag.

Dealers said rice prices could fall further as they were still ruling at higher levels and there was a lull on the export front despite Iran’s announcement that it would abolish import duty on Pakistan rice.

Wheat followed rice as supply position improved partly to larger arrivals from upcountry markets and partly to release of more imported stuff to the mills.

Sugar, which was showing increase for the last couple of weeks, also declined by Rs80 on selling by mills followed by reports of record production of 4.5m tons.

Among pulses, masoor type, which had risen to all-time high, came in for active selling by importers and was marked down by Rs300 per bag, while other varieties were traded at previous levels.

Cereal sector lacked normal support owing partly to comfortable ready position and prices of maize, jowar, bajra and guar seed were firmly held at the last levels amid light trading.

Oilseed section also showed dull trading in the absence of strong demand by mills. As a result prices of major seeds including rapeseed, cottonseed, castorseed and til were firmly held unchanged at previous levels.

Oilcakes, on the other hand, turned mixed and cottonseed cakes fell by Rs25 per 40 kg on selling prompted by reports of new crop arrivals, while rapeseed cakes were held unchanged at previous levels.—M.A.