MULTAN: Listless conditions prevailed on the cotton market on Friday as buyers and sellers opted for the wait-and-see approach.

The Karachi Cotton Association decreased its spot rate by Rs50 at Rs8,700.

Multan-based broker Syed Mudabbir Shah said that rumours that the government is likely to impose sales tax on cotton purchase have set off alarm bells in the market.

He said payments to ginners by the spinners are already a problem as the pace of disbursements is very slow. A major reason behind slow payments is increase of Rs1,500-1,700 per maund as compared to last year. Imposing of sales tax on cotton purchase will further worsen the payment schedule, he said.

Mr Shah said that due to the prevailing uncertainty in prices the spinners are planning to keep their mills closed during Eidul Fitr holidays. There are expectations that there would be an increase of Rs200 per maund in the prices of cotton after Eid, he added.

The following deals were reported to have transpired on ready counter: 1,000 bales, station Rahim Yar Khan, at Rs8,775; 400 bales, Chani Goth, at Rs8,800; 200 bales, Jalalpur Pirwala, at Rs8,500; and 400 bales, Alipur, at Rs8,000.

Published in Dawn, May 25th, 2019