KARACHI, Aug 26: Trading activity on the cotton market on Monday remained modest as both sellers and buyers awaited reports about the rain in the cotton belt before making fresh commitments.

Ginners held on to their positions anticipating increase in prices because of an expected fall in arrivals of lint from the interior, while spinners appear to be in two minds about the post-rain market trend.

“Monsoon rain at this time of the season could prove a double-edged weapon for cotton,” says a leading broker, “on the one hand it will increase the crop prospects in the form of higher production, and on the other it could push prices further higher owing to an expected pressure on supplies.”

However, wider benefits of rain for the farm sector are not ruled as it hastens the growth of other kharif crop along with cotton adding significantly to national produce, he says.

The rain in the cotton belt has hit the picking of phutti because it cannot be carried out in wet fields hence the fall in arrivals into the ginneries and higher prices.

According to reports coming from the Sindh cotton belt the clouds are thick and there are chances of heavy rain during the night but so far there is a drizzle or light rain in some of the areas.

Market sources said heavy rain will certainly affect the current price line depending on its intensity but on long-term basis it is good for all the crop including cotton.

Meanwhile, a leading section of spinners also remained busy in finalizing the strategy for the next TCP local sales tender as most of them are inclined to lift substantial quantity of fine lots in line with the TCP benchmark price, they added.

Official spot rates were held firmly at the weekend level, although most of the deals in the ready section were done above them.

For the third session, ready offtake remained modest as till late in the evening about 2,000 bales from the Sindh ginneries changed hands as under: 200 bales, Tando Adam at Rs.2,050, 400 bales, Sultanabad at Rs.2,100, 200 bales, Mirpurkhas at Rs.2,100, 100 bales, Rs.2,1500, 200 bales, Khipro at Rs.2,130, 100 bales, Sinjoro at Rs.2,120, and 400 bales, Shahdadpur at Rs.2,100.

A couple of lots from the central Punjab ginneries changed hands between Rs.2,150 to 2,175 per maund.