Prices of essential items on the Karachi wholesale markets showed increase during the last week as leading brokerage houses covered positions fearing pressure on supplies owing to on-going Iraq war and interruption in imports.

Pulses led the market advance amid fears of short supply of the imported stuff because of Iraq war and interruption in import consignments, dealers said.

But on the other hand both wheat and sugar suffered fall on selling prompted by reports of steady new crop arrivals. But major export items, notably rice lacked normal trading interest because of fears of interruption in physical shipments because of Iraq war and the absence of fresh export orders.

According to market sources some of the leading importers of local commodities were not opening fresh letters of credit fearing delay in shipments, although prices, notably of rice were rising because of war.

Most of the industrial raw materials as well as those essential items, including pulses were a bit expensive followed by reports of levy of war surcharge.

However, there was no panic on the commodity markets as the rise and fall in prices depending on the size of arrivals was orderly and did not reflect unfounded fears about the ready supplies.

Bulk of the activity was confined to essential items under the lead of wheat, whose prices suffered fall followed by reports of steady new crop arrivals from the lower Sindh wheat belt.

But reports that Bangladesh is in the market to buy 0.1 million tons of the commodity could push its price higher in the coming weeks despite the fact that another bumper wheat crop of over 21 million tons is around.

Egypt and Iran also intend to make further import of the wheat from Pakistan during the current year and so are some African and Gulf countries. Last year, Pakistan sold about million tons of the commodities to a number of countries, including Iraq.

Sugar on the other hand ruled easy and prices fell despite reports that the Trading Corporation of Pakistan (TCP) is selling the commodity to the foreign buyers after purchasing it from the local sugar mills.

Already, the TCP has sold a consignment of 25,000 tons at $213 per ton to a foreign buyer and has floated another international tender for the identical quantity against which bids have already been received. Rice sector was, however, an exception which stayed mixed apparently amid fears of an interruption in exports owing to Iraq war and falling export orders.

Sugar suffered a modest decline of Rs30-40, while desi sugar and gur were traded at the last level amid slow trading. Major industrial raw materials, notably on the oilseed sector resisted fresh decline and mostly quoted at the previous levels amid modest activity, notably in the rapeseed sector.

Castorseed and till followed them as prices of the both were quoted lower despite reports of active foreign demand from the latter. Guar on the other hand showed a modest rise of Rs10.

Pulses showed firm trend on revival of demand from the Punjab dealers and pressure on ready supplies. Tuver, gram, gram dal, beetle and masoor were quoted higher by Rs25 to Rs150, while masoor dal fell by Rs50 to Rs100.

Rice sector showed firm trend followed by reports of short supply, and prices of kernal basmati rose by Rs100, while sela type suffered a decline of Rs25, with all other varieties remaining pegged at the last close.

Cereals on the other hand stayed firm under the lead of jowar, barley, maize and bajra, but bulk of the business was done at the previous levels.

Oilseed sector on the other hand came in for active support under the lead of rapeseed, which rose by Rs10-15 followed by reports firm oilcakes market. Other new crop varieties also came on the board. Both castorseed and til suffered fresh decline ranging from Rs10 to Rs20.

Oilcakes again showed divergent trend and while rapeseed cakes rose by Rs5; cottonseed cakes fell by Rs5-10 followed by reports of steady arrivals from the ginneries.—M.A