KARACHI, April 5: The cotton market on Saturday passed through another relatively quieter session as spinners were still in the process of formulating new purchase policy in the backdrop of final production figures.

But no one among them appears to be in a haste to make panic buying fearing an imminent price flare-up because of a lower crop of below 10 million bales, dealers said.

However, some of them remained in the market and lifted stray lots of inferior types for blending purposes with polyester fibre to produce cotton yarn for foreign markets, they said.

Most of the deals were reported below Rs2,600 per maund as leading ginners also tried to clear the backlog well in time fearing fall in prices during the coming months owing to larger imports to cover the local crop shortfall.

Although spinners have imported over half-a-million bales of long staple lint from various sources to produce higher counts of cotton yarn for the foreign buyers since the beginning of the season from Sept 1, 2002, the supply situation has altogether changed after the release of final crop figure of 9.7m bales, well below the earlier estimated total of 10.5m bales.

“The developing situation on the cotton front could have a negative bearing on the total exports as the textile sector contributes about 65 per cent to the total,” spinners fear.

The distributing feature is that they have to go a long way to cover the crop shortfall in the wake of expensive foreign lint, which will have negative impact on the margins,” they said.

According to textile industry sources they will need about 2 million bales more to cover their annual consumption needs.

During the last two years, annual mill consumption had crossed the 12 million bales figure as more sick mills have resumed commercial operations after expansion and modernization.

Official spot rates remained basically unchanged from the previous levels, but New York cotton futures showed fresh rise of 0.19 and 0.24 cents per lb at 57.69 and 59.10 cents per lb, respectively, for both the ruling May and the forward July contracts.

Ready offtake remained light totalling about 4,000 bales as under:

SINDH TYPE: 900 bales, Gothki at Rs2.550; 600 bales, Rohri at Rs2,550, 400 bales, Sarhad at Rs2,675 on one-month credit; and 400 bales, Dharki at Rs2,675.