KARACHI, Dec 21: After several lean sessions, stray business was reported on the cotton market on Friday as spinners resumed covering operations despite the fact that ginners were not inclined to lower their asking prices.
Although physical business was light most of the deals were finalized at the higher rates depending on the quality in trade both from Sindh and southern Punjab ginneries.
The TCP rates offered to the ginners for the fine types were still a bit higher, some of the leading ginners opted to oblige spinners owing to procedural problems associated with selling to the public sector agency, dealers said.
They said leading ginners holding long oversold positions were worried over the news that spinners have contracted to import a substantial quantity lint from the overseas markets, which could well lead beyond their holding capacity.
However, TCP is silent on the emerging scenario on the cotton front and is not inclined to intervene until prices drop below the minimum prices, they added.
Floor brokers said in normal conditions spinners should have been back in the market after the Eid holidays but there is no evidence of pent-up demand from even the needy mills.
“It appears from the ready dealings that spinners have curtailed their daily buying to keep ginners at their toes all the time and force them to lower their asking prices”, they added.
Despite having liquidity problems ginners are holding to their positions in the hopes that both the TCP and the Spinners will resume their normal operations after the end of the current year.
The recent decline in New York cotton futures from the seasonal peak of 38 cents per lb to 35 and 37 cents per lb for both the ruling March and the distant May contracts did not affect the local price line.
There was, therefore, no change in the official spot rates, while ready rates were in line with the quality premiums.
Ready offtake was modest as till late in the evening about 5,000 bales both from Sindh and Punjab ginneries changed hands, the following being some of the notable deals:
SINDH TYPE: 400 bales, Bhira done at Rs1,850, 1,000 bales, Moro at Rs1,900, 500 bales, Mehrabpur at Rs1,940 and 600 bales, Dharki at Rs2,000.
PUNJAB VARIETY: 400 bales, Khanpur at Rs2,000 and 1,500 bales, Sadiqabad at Rs2,000.