KARACHI, Dec 17: Physical activity on the cotton market on Friday was maintained on the higher side as spinners and mills continued to cover their forward positions at the prevailing prices.

Much of the activity remained confined to quality and contamination-free lots as both the spinners and the TCP tried to grab the floating stock. Most of the deals in premium lots were finalized between Rs1,900 and Rs1,950, with K-68 from upper Sindh ginneries being the highest price getter as some of their lots were sold at Rs1,950 per maund.

"The market is stable around the current levels as buying offers are being adequately accommodated by the ginners," says a leading floor broker, adding that "the latest arrival figures for the fortnight ended Dec 15, may not affect the price line."

The Pakistan Cotton Ginners Association (PCGA) is expected to release the arrival figures of phutti possibly by Saturday, which will give a fair idea about the size of the total crop, which is being billed as a bumper crop, he adds.

The general perception behind the firm price outlook is that even if the crop touched the high mark of 11m bales, it will be far below the annual consumption needs of the textiles sector, some analysts said and added that could keep prices on the higher side for coming weeks also.

During the last couple of years, the use of polyester fibre has increased to about 30 per cent as foreign demand for blended yarn and cloth is on the higher side, which in turn has cut the mill demand for lint cotton, spinners said.

But the textile sector still needs 12m bales plus to see the year through as more sick units have resumed operations and added to it massive expansion programmes carried out by some of the leading spinners, they said.

They said the ginners were assured of quick lifting of their unsold stocks as the TCP was there to come to their rescue as a second buyer. It has already purchased about 2m bales and has invited foreign buyers for its recent tender for 25,000 bales, bids for which will open on Saturday (Dec 18).

Average official spot rates were further lowered by Rs20 in line with the deals in the ready section. But on the other hand, New York cotton futures tended further higher by 0.70 and 0.40 cents at 43.46 and 43.49 cents per lb, respectively, for the ruling March and the distant May settlements. Ready off take was on the higher totalling about 20,000 bales as under:

SINDH TYPE: 3,000 bales, upper Sindh at Rs1,925 to Rs1,950; and 1,000 bales, Sanghar (inferior quality) at Rs1,580 to Rs1,650.