KARACHI, Aug 20: Trading activity on the cotton market on Saturday slowed down as spinners were not inclined to make fresh commitments at the higher asking prices by ginners. Stray business was, however, reported at Rs2,275 per maund as compared to official spot rates of Rs2,225, as some of the spinners needing immediate supplies made modest covering purchases.

However, there were no reports of panic among the spinners and mills over the official report of damage to the crop because of pest attack in some areas and the talk of lower production, brokers said.

According to a revised official crop estimate, the targeted figure of 15m bales may not be achieved, although it is unclear about the actual estimated damage to the standing crop in the Punjab cotton belt, they said.

“After having purchased about 12m bales from the ginners from the last crop and a million bales from the TCP in its recent auctions, the spinners and mills are said to be in a comfortable supply position at least for the next six months when the size of the crop will be clear,” market sources said.

They could rely on their stock positions and may not chase higher prices as they have to strictly maintain their export parity levels, the sources said. Moreover, due to a persistent decline in New York cotton futures, which generally sets the world market price trends, an import option is there for the spinners and mills.

Meanwhile, reports coming from major cotton growing areas indicate that an extremely warm weather is said to have killed a good part of the attacking insects, notably white fly and American Sundi, both are said to be causing damage to plants before the flowering stage.

New York cotton futures, though stayed well below their benchmark of 50 cents per lb, showed a modest recovery after a persistent decline and were quoted higher by 0.61 and 0.52 cents per lb at 46.87 and 48.56 cents for both the ruling October and distant December settlements, respectively.

There was, however, no change in the local spot rates, which were held unchanged at Rs2,225 per maund.

Ready offtake was light totalling about 1,000 bales, the following being some of the notable deals: 200 bales, each from Sanghar and Mirpurkhas at Rs2,275 per maund.