KARACHI, Aug 18: Cotton prices eased modestly from the recent higher levels on Monday in line with the strong recovery of 1.6 per cent by the rupee against the dollar after the resignation of President Pervez Musharraf.

Most of the deals in the ready section were finalised at Rs4,225 and Rs4,250 showing a decline of Rs25 to Rs75 per maund as compared to the previous rates.

A forward deal by a Shahdadpur ginner for delivery on Sept 1 was finalised at Rs4,150 per maund, indicating that the future price outlook could be bearish if the crop size is in line with official target and the mealy bug attack in the entire Punjab cotton belt is controlled, said a leading floor broker.

However, the reports reaching here from the central and southern Punjab are terribly disturbing as the post-rain pest attack is partially controlled despite regular spraying, he said.

He said barring selected mild pest attacks here and there the crop is normal in the entire cotton belt and the production is expected to be according to official projections.

He said the government would have to go for a varietal changes, introducing B.T. type of certified seeds on the pattern of India, which has doubled its production after such changes during the last couple of seasons.

Most cotton analysts believe that the next month is very crucial for the crop, but higher cost of inputs, notably substandard pesticide, most of the small growers may not be in a position to harvest a profitable crop in the face a massive pest attack.

There was, however, no change in the official spot rates, which held unchanged at Rs4,200 per maund.

The following are some of the notable, which gone through late on Monday evening:

SINDH TYPE: 2,000 bales, Tando Adam and 1,000 bales, Sanghar at Rs4,225 to Rs4,265, 2,000 bales, Shahdadpur at Rs4,235 to Rs4,265, 600 bales, Mirpurkhas and 800 bales, Khipro at Rs4,250.

PUNJAB VARIETY: 1,600 bales, 600 bales each and 200 bales Kabirwala at Rs4,250.