TRADING remained light on the Karachi wholesale commodity markets last week as dealers and retailers made limited purchases amid hopes of further decline in prices on reports of fresh wheat and sugar imports.

Importers and local stockist are holding back their stocks believing that imports would take about two months and anything can happen to supply in between, said the brokers.

Arrivals from upcountry trading centres were high but it failed to push the prices lower as a section of stockists continued to build their positions in some essential items.

While wheat eased further, sugar stayed firm despite import permission. The TCP has been directed to trade in 0.1 million tons from India.

Wheat is expected to ease more as the government has allowed to bringing in wheat flour from a number of countries, including Dubai. According to market sources some importers have already opened the Letters of Credit for 1,000 tons from Dubai at the rate of $210 per ton.

The imported flour is expected to be sold at around Rs15 to 16 per kilo after adding the landed cost which in turn will ease local prices, they said.

Both the TCP and private sector importers had, some few months back, imported a substantial quantity of the commodity. This failed to check the hike despite the release of stocks through the Utility Stores Corporation at subsidized rates, dealers said.

Although sugar mills are still holding a stock of about one million tons and its availability together with the TCP stocks comes to about 1.5 million tons which is enough to meet the local demand at cheaper rates before the new crop arrives in November or early December, they said.

On the pulses counter, price changes were fractional despite a cut in the withholding tax. Prices did not fall accordingly as leading importers held on to their foreign stuff perhaps for higher rates.

Cereals on the other hand stayed firm at inflated levels amid reports of pressure on ready supplies owing to slow arrivals from the upcountry markets followed by reports of holding back of stocks by the leading stockist.

In physical trading, price changes were fractional as most managed to finish unchanged amid slow local demand and steady arrivals from the upcountry trading centres.

Among pulses, masoor was an exception which attracted selling and was marked up by Rs100 per 100kg bag. All other varieties including gram whole gram dal, moong, tuver and beetle were traded at last levels. Guar followed them.

Dealers have said that the full impact of the withholding tax cut was yet to fully manifest itself as leading stock holders are holding the price line after staying back from the active market.

After early fall, wheat ended unchanged as arrivals from the upcountry market dried up and local stock holders kept to the sidelines. Prices are expected to fall from the current level once imported consignments arrive, they said.

Sugar stayed firm despite reports of imports from India. Brokers said that the prices showed a modest fall on retail front but supply position remained under pressure. The TCP has floated a tender for 50,000 tons of the Indian sugar.

Rice sector again stayed dormant amid reports of larger export and dwindling stocks in commercial houses. Unlike previous weeks, no rice loader called at the port last week apparently in the absence of fresh import orders. Prices of both IRRI and basmati varieties were quoted unchanged.

Cereals on the other hand remained under pressure on selling prompted on reports of steady arrivals from the upcountry markets. Bajra and maize were leading among them, off by Rs50 to 100. Jowar and barley were traded at previous levels.

Oilseed sector ruled quietly steady as prices of cottonseed, rapeseed, til and castorseed were firmly held at previous levels as supplies matched the demand.

Oilcakes on the other hand ruled steady, while cottonseed cakes rose by Rs5 to 10, rapeseed cakes were traded at previous levels.—M.A.

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