KARACHI, Feb 23: After ruling dormant for the last couple of sessions, cotton prices on Wednesday rose by Rs35 to Rs50 per maund in physical trading boosted apparently by sharp increase in the New York cotton futures.

About 6,000 bales, mostly fine lots from the upper Sindh and southern Punjab ginneries changed hands at Rs2,275 on the lower side and Rs2,300 on the higher side, sending alarming signals in the textile industry, brokers said.

For the last couple of sessions, spinners and mills were holding the price line, compatible to export parity levels around Rs2,250 on the higher side after playing hide and seek game with the ginners, they said.

"But snap price flare-up on the New York cotton future changed the local future price outlook on the perception that imports may be expensive and spinners have to cover their forward positions from the local market," they said.

Market sources said unlike the previous sessions, spinners and mills have to pay a bit more for fine lots, which may be in short supply in the coming weeks as bulk of it has already been purchased by the TCP or the leading spinner groups.

Prices may remain stable around the current level before the arrival figures for the fortnight ending Feb 28,they said adding any further rise will be essentially guided by the supply and demand figures.

Spinners and mills have already purchased about 12m bales of lint and may need another 2m bales plus to meet their increased intake and that could exert pressure on the supplies and consequent increase in prices, they said.

Un-organized textile sector is also in the market and may need half a million bales to cover their forward demand for the current season. Official spot rates for average quality of lint were firmly held at Rs2,175, but fine lots were sold around Rs2,300 per maund.

After ruling either-way for the last couple of sessions, New York cotton futures posted gains ranging from 1.71 to 1.95 cents per lb at 48.25 and 49.43 cents per lb respectively followed by reports of increased world demand.

Ready off take was modest totalling about 10,000 bales as under: 6,000 bales, of fine varieties from upper Sindh and southern Punjab ginneries at Rs2,285 to 2,300, 2,000 bales, each Jhole and Dharki at Rs2,200 and 2,245 respectively.