TRADING activities in the wholesale commodity markets last week remained insipid leading to decline in prices. Traders cited low demand as the main reason behind slow trading.

On the other hand supplies from upcountry, local producing areas and through imports remained brisk.

Traders said arrival of goods from Sindh and Punjab was at an improved pace but retailers did not pick up items owing to thin demand from buyers.

“Buyers’ inclination towards lifting of commodities usually declines at the fag end of every month due to strain in availability of cash,” they said.

The wholesale commodity market Dandia Bazaar and other such markets in the old city areas remained closed on Tuesday and Wednesday owing to intense violence and heavy casualties. Due to poor law and order situation, traders said, attendance of retailers was thin.

While the retailers said they were still feeling insecure to carry cash to wholesale markets for buying commodities.

The budget expected on June 1, retailers said, the market lacked buying activities for fear of tax and duty adjustments resulting in fluctuation of rates.

Since prices of edible had already gone up exorbitantly in the last four years, any consumer could hardly pile up commodities in advance of budget announcement. The trend of pre-budget buying had almost vanished from the markets, they added.

Retailers said consumers knew the government had nothing to offer in the budget to provide any relief to consumers.

However, importers/manufacturers of ghee and cooking oil were in a hurry to pile up stocks which was evident from increase in imports of these items in April which went as high as 156,283 tons ($173 million) as compared to 96,691 tons ($106 million) in March 2012.

A ghee manufacturer, Ahmed Rashid, said that amid fluctuation in prices of palm oil in world markets, the cooking industry would have to keep raw material stocks on higher side to meet the rising demand during the holy month of Ramazan starting from July 22. Imports of edible oil would go further up in coming months, he added.

However, he said in the international market palm oil prices had declined during the last week.

The total import bill of palm oil had surged to $1.9 billion (1,687,858 tons) in July-April 2011-12 as against $1.6 billion (1,605,743 tons) in the same period last fiscal year.

Wheat: Price of the commodity did not show any change during the last week because of improved supplies from wheat growing belts of Punjab and Sindh. A flour miller said around 5,000 tons of wheat were needed daily to feed the huge population of Karachi.

Pulses: In pulses and sugar sectors, wholesale rates fell slightly last week. Chairman Karachi Wholesale Grocers Association (KWGA) Anis Majeed said the supply situation was normal, either due to imports or arrivals from local producing areas, but decline in demand had pushed the price down.

The rupee remained under pressure against the dollar last week making imports costlier. However, so far the wholesale rates have not witnessed any fluctuation due to losing rupee.

Import of pulses slightly fell to 502,426 tons ($320 million) in July-April 2011-12 as compared to 552,017 tons ($345 million) in the same period last fiscal year.

Normal supplies of sugar continued from mills declining its rate in the wholesale market.

According to figures of Large Scale Manufacturing, 4,485,592 tons of sugar was produced in July-March 2011-12, which was 15 per cent more than 3,892,141 tons produced in the same period last fiscal year.

Due to improved production and stocks this year, the country exported 23,776 tons ($15 million) from March to April 2012.—Aamir Shafaat Khan