KARACHI, Oct 13: Cotton prices on Monday again rose to a record level of Rs3,200 per maund as ginners raised their asking prices followed by a considerable decline in daily arrivals of phutti into the ginneries.

Most of the deals in Sindh varieties were done between Rs3,000 and Rs3,100 per maund, and Rs3,200 per maund without sales tax in the southern Punjab cotton belt.

Till late in the evening, Sindh ginners were seller around Rs3,000 per maund but failed to find many willing buyers.

Whether or not the growers are holding back of unsold stocks of phutti to prop up prices, which had fallen from the recent peak level of Rs1,400 per 40 kg to Rs1,100 on Saturday last, or the final picking operation has been completed is pretty hard to predict, market sources said, adding but “drying up of arrivals for whatever reasons has again caused the bull-run on the market.”

The fresh price flare-up was also attributed to official rejection of spinners’ demand to an export of lint until December as by that time the size of crop will be clear. The cotton trade is being regulated under a free export and import policy.

“Backed by higher world prices of lint, it may now not be that easy to contain the current price flare-up, although a bit restraint on the part of spinners could ease the price situation,” they said.

With New York cotton futures ruling well over the 70 cent per lb level it may not be that easy for the mills to opt for the imported stuff and the consequent pressure on the local supplies could well mean further increase in prices.

Renewed fears about a short crop again dominated the trading after the market reopened as leading spinners made an abortive bids to grab the floating stock but ginners appear to be in no obliging mood, brokers said.

“The standoff between the buyers and the sellers over the price issue fuelled fresh speculative mill buying and the consequent flare-up irrespective quality premiums.”

What seems to have triggered renewed mill buystops was reports of below 9m bales crop figure, which could well mean spinners have to face a supply gap of about 2m bales during the current season.

“Big ones may survive the current price flare-up, their weaker links will remain at the receiving end because of financial constraints and a possible choking of export outlets in the backdrop of higher lint prices,” some dealers fear.

In line with ready prices at which deals are being finalized, official spot rates were also revised upward by Rs225 per maund at Rs3,025 as compared to Saturday’s Rs2,800.

Ready offtake was active as till late in the evening about 15,000 bales, mostly from the southern Punjab cotton belt changed hands between Rs3,050 and Rs3,150 per maund but no spinner was inclined to bid at Rs3.200, although there were many sellers at this rates.