KARACHI, July 14: Trading activity on the cotton market on Wednesday showed a modest improvement as some of the mills and spinners resumed their covering operations at the lower levels.

Some of the spinners purchased 400 bales of new crop from the central Punjab ginneries at Rs2,450 and Rs2,550 per maund. New crop phutti is being sold at Rs975 per 40 kg in the lower Sindh cotton belt and at Rs1,000 in Punjab.

The perception that the current downward drift on the New York Cotton Exchange was halted as prices there had already hit 20-year lows encouraged the spinners to make fresh commitments amid reports that the possibility of further decline is remote, market sources said.

The official rate committee further lowered the spot rates by Rs50 per maund for the third session in a row, the total loss being Rs100. Some of the local mills lifted about 5,000 bales, between Rs2,200 on the lower side and Rs2,500 on the higher side depending on the quality of lint in trade, brokers said.

They said some of the ginners from the central Sindh cotton belt still holding stray stocks of low-mic lint were now not inclined to hold on to old stocks and were selling it at buyers' option.

Reports that some of the ginners both in the lower Sindh and the central Punjab cotton belt have resumed ginning operations on modest scale and arrival of the new crop is expected early next month worried those who still hold unsold stocks, they said.

In its earlier meeting, the Pakistan Cotton Ginners Association (PCGA) has decided to resume new crop ginning operations in Sindh from August 15, and from September 15 in Punjab, but some of the ginners seem to have defied the official ban.

The delayed ginning operations are meant to give a breathing space to the ginners in a falling market to dispose of their unsold stocks, dealers said. New York cotton futures on Tuesday were quoted unchanged for the ruling October settlement at 46.60 cents while the forward December showed a fractional fall of 0.3 cents at 47.30.

Ready offtake was modest totalling about 5,000 bales, changed hands, the following being some of the notable deals:

NEW CROP: 200 bales, Chichawatni at Rs2,450 and 200 bales, Burewala at Rs2,550.