KARACHI, March 21: Physical activity on the cotton market on Tuesday showed a modest expansion as some of the spinners covered positions at an average rate of Rs2,450 per maund, slightly above the official spot rates. But bulk of the support was confined to fine lots from southern Punjab ginneries, well-known producers of contamination-free lint, as some of the leading mills need it for blending purposes to spin higher counts of cotton yarn, brokers said.

As a result, for the first time after several weeks, a big-lot deal was reported as a leading group of spinners purchased 9,000 bales from different ginneries.

“But it does not reflects that the spinners have resumed their covering operations in a big way after the size of the crop is a bit clear,” said a cotton analyst, adding: “Some of the ginners who were expecting an increase in prices appear to be disappointed sellers.”

However, the spinners are not in a hurry as they are pretty sure that with an unsold stock of 1.4m bales lying at ginners’ godowns and 0.450 bales with the TCP, there is no cause of worry about the future supplies, he added.

“The persistent fall in New York cotton futures for the last about a week, which has made imports more competitive, is also said to be the chief factor behind the spinner going slow,” market sources said.

After having purchased a substantial quantity of lint from the TCP’s recent auction, the spinners and mills are said to be in a pretty comfortable position at least for the near-term despite higher exports, they added.

But leading ginners on the other hand are worried over the larger unsold stocks, which are straining their liquidity positions owing to lack of normal mill demand.

Official spot rates were, therefore, held unchanged at the overnight level, although some of the deals were done well above them.

New York cotton futures on the other hand suffered fall of 0.55 and 0.53 cents per lb for both the ruling May and the distant July contracts at 53.51 and 54.77 cents, respectively.

Ready business was on the higher side totalling about 15,000 bales, the following being some of the notable deals: 9,000 bales, Lodran, Jalalpur and some other stations at Rs2,450 to Rs2,460; 2,000 bales, Rahimyar Khan at Rs2,465 to Rs2,475; and 800 bales, upper Sindh at Rs2,450.