KARACHI, Sept 18: The cotton market on Tuesday witnessed brisk trading activity as spinners and mills continued to build up long positions at the prevailing levels amid fears of another price flare-up.

Another 15,000 bales changed hands around the overnight level of Rs2,850. The notable feature was that the Sindh type was sold at a premium as compared to its central Punjab counterpart, market sources said.

Owing to persistent increase in international cotton prices, notably in the New York cotton futures which are being quoted well above the 61 cents per lb mark, spinners fear a sympathetic rise in local prices and indulged in panic buying at Rs2,900 per maund.

Irrespective of quality considerations, the general perception among the spinners and mills was that no one would be in a position to hold prices around the current level in future.

The current hectic buying reflects this perception as it may not be possible for them to keep the wheels of industry moving after having purchased costly lint, they added.

“The quality of central Punjab lint is said to have damaged by the late monsoon rain and last month’s mealybug attack and that is perhaps why it is being sold at a discount,”

they said.

In physical trading, Sindh type was traded between Rs2,850 to Rs2,900 per maund, while Punjab variety fetched a uniform rate of Rs2,850, a discount of Rs50 per maund.

As a result, official spot rates were again held unchanged at Rs2,800 per maund.

But New York cotton futures on the other hand rose further and were quoted higher by 0.75 and 0.82 cents per lb at 61.57 and 64.43 cents for both the ruling October and distant December contracts respectively.

The following deals were reported by the brokers to the Karachi Cotton Association on Tuesday.

SINDH TYPE: 1,000 bales, Sanghar at Rs2,850 to Rs2,875, 200 bales, Kadro and Nayabad at Rs2,850 to Rs2,875, 1,200 bales, Tando Adam at Rs2,885 to Rs2,900, 200 bales, Mirpurkhas a Rs2,875 and 600 bales, Shahdadpur at Rs2,885.