KARACHI, Aug 4: Trading on the cotton market on Thursday remained insipid as leading spinners adhered to the sidelines apparently awaiting fresh date and number of bales for the TCP auction. Market sources said it might be the last TCP auction before an August 15 deadline set by the government to dispose of its stocks, after having a manageable buffer stock to meet any emergence in case of failure.

The unsold stocks with the TCP after the next auction may be around 0.350m bales, while bulk of the total has been purchased by the local mills and some foreign buyers, they said. However, foreign sales are reported to be well below the initial target because of price differentials in the backdrop of erratic New York cotton futures and foreign buyers’ perception to follow the world rates, they said.

Some of the European buyers managed to buy modest lots in earlier auctions between 43 to 46 cents per lb but after the New York cotton futures crossed the benchmark of 50 cents, they could match the local offers. But some others said that being in a fairly comfortable stock position as spinners and mills have lifted bulk of the lots from the TCP, they may not be as aggressive buyers as they had been two months back.

They said some of them having sound financial positions might opt for fresh buying if reference prices were in line with their parity levels. Indications are that the mill consumption of lint during the current fiscal year ending Aug 31, could touch new peak level of well over 15m bales most of them are fully booked at least for the next quarter ending Dec 31, 2005.

Already, textile exports have set new record and are expected to hit the target of $10 billion during the next year if the current pace of consumption of lint is maintained, spinners said. Official spot rates hovered around the previous levels amid reports that some business was finalized in the current crop at around Rs2,350 per maund.

Ready offtake was light, although some of the brokers reported some deals in the new crop at around Rs2,400 per maund but there was official confirmation from leading brokerage houses.