KARACHI, May 7: Cotton prices on Wednesday eased modestly apparently in sympathy with the limit-fall in New York Cotton futures but spinners adhered to the sidelines amid predictions of an easy local market in coming days.

New York cotton futures are heading to breach through the 50-cent per lb barrier owing to persistent speculative selling followed by fears of a sharp decline in demand from China and some other major Far Eastern consumers because of SARS virus, brokers said.

Both the maturing May and the forward July settlements were marked down by 2.05 and 2.16 cents per lb at 50.20 and 51.76 cents per lb respectively, showing a decline of about 10 cents per lb since the outbreak of SARS in China.

World cotton trade is in a virtual turmoil as threat of SARS seems to have taken steam out of the world markets at least for the near-term, some brokers said.

Local market, which has been holding steady on the strength of falling unsold stocks after the run on New York cotton futures started some two weeks earlier in the backdrop of reports of SARS deaths in China finally gave in as some of the ginners opted for hasty selling.

Official spot rates fell by Rs15 at Rs 2,525 per maund after persistent rise during the last about three months aided by a short crop and fears of an imminent price flare-up.

Although some of the ginners lowered their asking prices in relation with quality premiums, spinners and mills stayed away anticipating further decline in prices.

“I don’t see any major downward change in the local rates in line with world prices as supply and demand factors will finally prevail after the current speculative SARS-selling dries up”, predicts a leading broker.

He says that prices could record a change of Rs50-75 per maund around Rs 2,400 level for an average quality lint, but fine lots are expected to remain expensive irrespective of the behaviour of the New York cotton futures in the coming sessions.

Meanwhile, reports coming from the entire cotton belt indicate that growers have made all arrangements to resume new crop sowing from May 15 — a time considered ideal for sowing to harvest a healthy crop.

Ready business, therefore, remained at a low ebb as spinners kept to the sidelines most of the time anticipating further decline in prices. As a result, till late in the evening ginners from the Sindh cotton belt did not report fresh deals.