KARACHI, Oct 5: Cotton prices on Thursday showed a modest fall on selling by ginners triggered by reports of higher arrivals of phutti into ginneries.

According to official arrival figures released by the Pakistan Cotton Ginners Association (PCGA), for Oct 1, 2006, the total amounted to 1.103m bales, comprising 0.647m bales from the Punjab and 0.457m bales from the Sindh cotton belt.

Major increase of over 14 per cent was recorded in the Punjab arrivals, which in turn have a negative impact on the lint prices. Sindh figure was also modestly higher to comparable figure of the last year, allaying fears of a major crop shortfall.

Out of the total, spinners have purchased 0.794m bales, and private sector exporters 4,000 bales, leaving an unsold stock of 0.306m bales with the ginners.

Floor brokers said the arrival figures were expected to halt the current rising trend in prices in the coming sessions as the crop might not be that short as being speculated.

Although physical business late on Wednesday evening was done at the higher rates, downward revision of official spot rates indicates that prices may now go further down, they added.

However, the future price outlook will essentially depend on the buying strategy of spinners and mills based on their crop perceptions, some others said

Official spot rates were lowered by Rs15 per maund at Rs2,460 in line with the average rate at which transactions are carried out.

New York cotton futures on the other hand recovered from the recent lows and were quoted higher by 0.50 and 0.79 cents at 48.90 and 50.16 cents per lb for both the ruling October and the forward December contracts, respectively.

Ready offtake was on the higher side totalling about 20,000 bales, the following being some of the notable deals:

SINDH TYPE: 4,000 bales, Shahdadpur at Rs2,450 to Rs2,470; 1,000 bales, Tando Adam at Rs2,425 to Rs2,450; 400 bales, Mirpurkhas and 200 bales, Sultanabad at Rs2,450.