KARACHI, Aug 21: Physical trading on the cotton market on Wednesday remained slow as spinners were reluctant buyers at the higher levels because of export parity problems.

Stray lots did, however, change hands but at the higher rates, ranging from Rs50 to Rs75 per maund as compared to overnight levels. Most of the deals in the ready section were finalized at Rs2,100 per maund or slightly above it.

The current rebound reflects that prices are heading to attain their pre-reaction level of Rs2,350 per maund after having touched the low of Rs2,000 a couple of sessions earlier, dealers said.

“A considerable decline in arrivals of phutti into the lower Sindh ginneries appears to be the immediate reason behind the current price flare-up”, they said adding “but prices are rising each session despite the fact that spinners are not inclined to make panic buying”.

Bulk of the mill buying remained confined to the new crop from the lower Sindh ginneries for quality reasons but there were no reports of any deal in the central Punjab cotton.

Although some of the ginners still hold about 20,000 bales of the current crop, spinners are opting for the local sales by the TCP rather, which is claimed to be of fine quality including some contamination-free lots from the model areas of Rahimyar Khan and Gothki ginning factories.

Floor brokers said most of the spinners actively participated in the recent tender of the TCP for the local sales and managed to win some fine lots after matching its benchmark price.

The TCP may be on the way out of exhausting its bulk of the stock of 0.257m bales it has procured to support the market during the current season, leaving the field open for the ginners in the subsequent months, they added.

It was interesting to note that local market was not influenced bearishly by the steep decline in New York cotton futures and behaved in line with the supply and demand factors.

New York cotton futures fell sharply by 1.43 and 1.39 cents per lb at 43.70 and 45.29 cents per lb for both the ruling October and the forward December contracts respectively.

Local official spot rates were further raised by Rs25 to Rs2,000 per maund owing to recent increase in physical trading.

Ready business was light as till late in the evening about 1,500 bales changed hands, the following being some of the notable deals, all from the Sindh ginneries: 200 bales, Shahdadpur at Rs2.100, 400 bales, Tando Adam at Rs2,100, 200 bales, Khipro at Rs2,125, 200 bales, Sultanabad at Rs2,125, 200 bales, Kot Ghulam Muhammad at Rs2,100 and 100 bales, Mirpurkhas at Rs2,100.