The Karachi wholesale commodity markets again showed mixed trend during the last week as prices of major essential items fell and rose, depending on ready demand and reports of oversupply on some of the counters.

While rice and sugar came in for active support followed by reports of steady export demand, some varieties of pulses, notably gram fell on selling followed by reports of steady new crop arrivals from the Sindh markets.

Dealers predicted that prices of both, notably the former, could rise further from the current levels as the stock of the current crop had almost exhausted owing to higher exports late last year and early this year.

The new crop will arrive sometimes in late September and early October and could well mean pressure on supplies and the consequent further increase in prices, they added.

The decline was led by gram and beetle, which remained under pressure despite a steady fall in imports from the foreign markets because of higher freight charges and the levy of war risk surcharge.

Dealers said prices should have risen as the supply gaps on the pulses counter were generally filled in by imports, but there were no reports of fresh letters of credit as importers feared interruption in consignments because of Iraq war.

Other major essential items, on the other hand, came in for active support under the lead sugar and wheat, which came in for renewed support despite steady new crop arrivals from the Sindh markets and sugar mills.

The harvesting of the wheat crop is also expected to resume in other major crop areas of wheat, both in Sindh and Punjab, which in turn could have negative impact on the prices in the coming weeks.

Moreover, brokers also fear interruption in new crop exports to the Gulf areas because of Iraq war as foreign buyers will await the end of war before making fresh commitments for the new crop.

Reports of another bumper crop of about 22 million tons is also expected to trigger fresh selling both from the agents and the growers as the latter will try to sell their stocks at the officially fixed price to the government.

Sugar also stayed firm on reports of steady procurement by the Trading Corporation of Pakistan (TCP) from the local sugar mills and export to foreign countries after inviting international tenders. The TCP last sold a consignment of 12,000 tons to a foreign bidder at $247 per ton. It has also floated tender of 13,000 tons for the local mills under a phased-out procurement plan of 0.1 million tons.

Rice sector on the other hand showed mixed trend as prices of some fine varieties showed fresh fall amid fears of interruption in exports to the Gulf states until the war in Iraq ends. But Irri types remained in active demand and rose further. Major decline of Rs100 per bag was noted in kernal type of basmati, while basmati short grain was quoted lower by Rs10, with Sela variety remaining pegged at the previous level.

Brokers said fall in export demand was said to be chief reason behind the decline in prices of fine types of basmati.

Irri-6 rose by another Rs40, Irri-9 Sindh by Rs25 followed by reports of active export enquiries from the African and Gulf countries.

Among the cereals, guar posted a fresh increase of Rs20, while suffered fall ranging from Rs25 to Rs75 on active selling by local dealers followed by reports of steady arrivals from the interior.

Major industrial raw materials, notably on the oilseed sector turned mixed and were mostly quoted at the previous levels amid modest activity. Rapeseed Dadu type and castorseed were an exceptions, which fell by Rs10 each on stray selling.

Til on the other hand remained under pressure followed by reports of falling export demand. Local crushers also stayed on the sidelines, which prompted selling from the commercial houses. It suffered a decline of Rs50. Oilcakes showed firm trend as prices of both rapeseed and cottonseed cakes posted gains ranging from Rs2 to Rs8 followed by reports of higher oil market.—M.A