KARACHI, Aug 20: Steady conditions were again witnessed on the cotton market on Wednesday as both spinners and mills continued to cover their short positions irrespective of the ginners asking prices.
The notable feature was that both the short staple Sindh and medium length Punjab lint was sold at the same average rate, although in normal trading conditions the latter is sold at premium of Rs50 to Rs100 over the former because of its higher staple length, dealers said.
Prices remained stable for the third session in a row as the price ideas of both the buyers and sellers were in line with their parity levels followed by active ready offtake.
Floor brokers said ginners were not inclined to hold on to their positions and prefer to indulge in ready sales of freshly ginned lint as no one among them is sure about the future price outlook because of conflicting reports of the size of the crop.
Ginners may have fair idea of the crop losses in the lower and central Sindh cotton belt, but reports coming in from the Punjab cotton belt indicate a good crop, they said.
It was in this background both the grower and the ginner are not inclined to hold ready stock just for a day and try to dispose it of irrespective of fluctuating prices.
Trading in new crop of Sindh, for instance, resumed around Rs2,550 per maund without 15 per cent sales tax and as spinners and mills remained active buyers prices steadily rose to Rs2,575 and most of the deals were finalized at this rates.
Meanwhile, some leading ginners claim the micronaire of the Sindh lint has over the last couple of sessions showed a significant improvement and is close to normal standard, which in turn, lured spinners to grab the floating stock.
Arrivals of phutti into the lower and central Sindh ginneries are claimed to be on the higher side as growers continued to flood ginneries. Most of the deals are done on ready basis as growers are in no mood to dump the commodity on an unfixed basis.
Official spot rates did not show any change, although most of the deals in the ready section were done well above them.
For the second session in a row, New York cotton futures on the other hand, posted fresh rise of 0.27 and 0.20 cents per lb at 55.17 and 56.31 cents per lb, respectively, on fresh speculative support aided by reports of larger US export commitments.
Ready offtake was modest as till late in the evening another 3,000 bales changed hands as under:
SINDH VARIETY: 200 bales, Tando Adam at Rs2,570 and 200 bales at Rs2,575; 200 bales, Shahdadpur at Rs2,575; 400 bales, Khipro at Rs2,575; 100 bales, Sultanabad at Rs2,560; and 200 bales, Pithoro at Rs2,550.
PUNJAB TYPE: 100 bales, Mungi Banglow at Rs2,575; 100 bales, Chichawatni and 100 bales, Sahiwal also at the same rate.