A FRESH flare-up in wheat prices again featured the trading on the Karachi wholesale markets last week as leading stockists held on to their unsold positions hoping to cash in on an acute ready position.

However, the largest rise of Rs1,200-2,000 per bag was recorded in prices of masoor whole and its pulse, which hit new all-time high on reports of pressure on ready supplies owing to fall in imports.

Sugar followed them, which also hit a new high after having increased by Rs150-350 per bag followed by reports of fixation of higher support prices for sugarcane (Rs81 per maund).

Market sources said fixation of wheat support price at Rs950 per 40kg from the previous Rs625, had a chain sympathetic bullish impact on other essential commodities early in the weak. The situation, however, eased after the arrival of the commodity from upcountry.

Owing to prevailing turmoil on the world commodity markets followed by weakness of the US economy, some floor brokers fear that export demand of some major export items including cotton and rice may remain on the lower side, having negative impact on local prices,

Arrivals from upcountry markets remained well below normal figures, which in turn boosted prices of some other essential items modestly, dealers said.

They said the future market trend appears to be on the higher side as investors from other markets including stock exchange and money markets are reported to have switched over to the commodity markets owing to prevailing recession there.

Price movements on other essential counters, notably pulses and sugar were orderly and reflected that there was no pressure on supplies despite the fact that fresh arrivals from upcountry markets were on the lower side.

Sugar prices are expected to rise from the current levels as the support price of sugarcane for the new crop has been fixed at Rs81 per 40 kg in Sindh and Punjab, brokers said.

On the other hand rice sector showed some either-way movement followed by reports of another bumper crop of well over six million tones, which, according to rice exporters, will ensure an exportable surplus of about three million tones after meeting domestic demand.

Prices of rice on the open market remained stable around previous levels but dealers said they would ease from the current peak levels after the new crop arrivals normalise.

The market advance was led by masoor and masoor dal on short supply caused by lesser imports owing to higher international prices in line with the run on the commodity markets. Importers kept to the sidelines and did not open fresh letter of credit amid fears that consumers may not buy it at the highly inflated levels.

Other pulses including gram whole, gram dal, beetle and urad were traded at previous levels amid slow ready off take and so did moong and some others.

Snap increase in sugar prices at the retailers end surprised dealers as there was no immediate reasons behind the price flare-up. The net increase in sugar prices was of the order of Rs150- 350 per bag of 100 kg.

Gur and sugar desi also came in for active support and were quoted higher by Rs200-300 amid active trading followed by pressure on ready supplies.

Rice sector, on the other hand, showed mixed trend. While IRRI-6 suffered a fall of Rs50, IRRI-Sela and Broken basmati were quoted higher by Rs.100-300 followed by reports of active export demand for both.

Among cereals, both bajra and barley came in for active support followed by reports of fall in arrivals and were quoted higher by Rs100-200 but jowar was held unchanged.

Among major seeds, both cotton and cottonseed came in for renewed selling and were quoted lower by Rs50-225, largest decline being in cotton owing to fall in international prices.

Rapeseed showed mixed trend amid active trading. While Nawabshah type managed to finish higher by Rs25-35 per 40 kg, others fell by Rs.50-75 on selling followed by reports of higher imports.

Til also came in for active selling followed by reports of slack export demand and was quoted sharply lower by Rs500 per 40 kg but on the other hand castor seed was held unchanged.

Oilcakes showed firm trend as prices of both cottonseed and rapeseed cakes posted gains ranging between Rs10 and Rs45 amid active trading.—M.A.