KARACHI, Jan 11: Trading activity on the cotton market on Friday was relatively slow as ginners were not inclined to further lower their asking prices, expecting advent of strong buying by the exporters.
Most of the deals in the quality lots were, therefore, again transacted at the overnight level of slightly below Rs1,800 per maund without 15 per cent sales tax as ginners were not willing to go below that.
Market sources said exporters were in the market, but they were after the inferior lots and purchased modest quantities below Rs1,400.
As the local prices of fine varieties from the southern Punjab cotton belt are claimed to be higher than the world rates, exporters have opted for the lower types, which have a ready sale outlets, they add.
“Owing to presence of both the spinners and the TCP in the arena, exporters are not inclined to bid for fine types, which could lead to further increase in prices,” they added.
It was perhaps because of this factor a battle of wits is going on between ginners and spinners to tilt the price balance in their respective favour, but it appears to be a no-win situation as the former are in no mood to sell below their parity levels.
As a result, spinners have slowed down their daily purchases apparently in an effort to unnerve ginners to lower their selling prices, says a broker, commenting on the current stand-off as far as daily turnover is concerned.
Spinners and mills are banking on the larger unsold stocks held by ginners and hope hasty selling any time, which in turn could lower prices from the current levels.
“Foreigners of textiles and cotton yarn are finalizing their current year’s intake of cotton yarn and once the priorities are defined they will re-enter the market and open letters of credit for the next quarter ending March 31, 2002, spinners say.
It was in this background that spinners were in the market but lifted only those lots, which were offered in line with their export parity levels.
Ready offtake was light as till late in the evening about 8,000 bales changed hands as under: 400 bales of Mirpur Mathelo at Rs1,800, 1,000 bales, Rahimyar Khan at Rs1,750 to Rs1,800, 1,200 bales, Sadiqabad at Rs1,725 to Rs1,750, 3,000 bales, Khanpur at Rs1,750 to Rs1,775, 400 bales, Burewala at Rs1,390 and 200 bales of Yazman at Rs1,675.