KARACHI, July 2: Cotton prices on Wednesday remained stable despite falling mill demand as ginners held on to their positions amid predictions of pressure on the nearby supplies.

Floor brokers said ginners were also encouraged by reports of steep increase in New York cotton futures prices in response to higher exports and did not lower their asking prices hoping a sympathetic positive impact on the local market.

Ginners, who had been the victim of falling mill demand for the last couple of weeks, appear to be a bit happy as the cotton situation tilted in their favour.

New York cotton futures on Tuesday rose by slightly below their limit gains for both the maturing July and the new crop October settlements at 58.10 and 59.88 cents per lb respectively, up 1.90 and 1.53 cents per lb.

What seems to have worried spinners was the fact that New York cotton futures at 60 cents per lb could create sympathetic bullish flutters all over the world, brokers said adding “world prices are generally guided by them with a discount of five to seven per cent depending on the quality premiums.”

Spinners fear that the local lint could be more expensive in the coming weeks if the New York cotton futures maintained their upward drive on the strength of higher exports and an increase in the local consumption.

But cotton analysts said the current boom-like conditions on world cotton market may not be sustained as major producers including China, India and Pakistan are expecting a bumper crop during the next season beginning from Sept 1, 2003.

“New York cotton prices are expected to fall from the current levels after the new crop starts arriving in the ginneries by late September and early October,” they said.

Having an overview of the world cotton situation, spinners and mills tried to grab the floating stock of lint but ginners raised their asking prices by Rs25 per maund and stray lots changed hands at the higher rates, dealers said.

Meanwhile, reports coming from the cotton belt said the condition of the new crop is fairly good and the current rain spell and the warm weather has minimized the incidence of pest attack.

Official spot rates were firmly held at the last close but new crop from the lower Sindh ginneries was quoted higher by Rs25 per maund.

Ready offtake was 400 bales of new crop, 200 bales each from Sultanabad at Rs2,300 and 2,335 per maund.