KARACHI, May 13: Cotton prices on Tuesday showed firm trend as a leading group of spinners was back in the market and indulged in a big-lot business in the backdrop of a grand rebound staged by the New York cotton futures.

The day’s trading was featured by a big deal of 12,100 bales from a Samundri ginner done at a high rate of Rs2,560 per maund, signalling the heating up of the local market after two weeks sluggishness.

After staying on the sidelines for the last couple of sessions, spinners re-entered the market followed by predictions of further rise in prices but ginners appear to be in not too obliging mood.

“I think prices could rise higher from the current levels if the supply and demand factors remained at work till the arrival of the new crop”, says a leading broker adding “the steep rise in world prices has already denied spinners the benefit of lower world prices”.

What seems to have forced spinners and mills to cover positions from the local market was the expensive world prices beyond their export parity levels both from cotton yarn and cloth, he adds.

But ginners were not inclined to fall in the trap and promptly raised their asking prices for the quality lint as most of the deals in physical trading were done well above the official spot rates.

The local prices are literally following the New York cotton futures which have risen by four cents per pound after having fallen to recent lows of 50 cents per pound for the May contract.

New York cotton futures on Monday were quoted at 54.15 and 56.90 cents per lb for both the ruling July and the new crop December settlements, up 0.81 and 0.90 cents per lb respectively.

Spinners claimed exports of textiles are picking up progressively and could well mean covering operations will be accelerated during the coming weeks.

The dullness, which has overtaken the market during the last about three weeks, is expected to be over as both spinners and mills will not await decline in prices and will cover positions in active trading.

Official spot rates on the other hand did not show any change and were held at the overnight levels, although most of the deals were finalized according to quality premiums.

Ready offtake was large totalling about 15,000 bales as under: 12,100 bales Samundri at Rs2,560; 500 bales Shorkot at RS 2,475 and 1,000 bales Dharki at Rs 2,550.