KARACHI, April 23: Trading activity on the cotton market was a bit slow on Wednesday as ginners held on to their unsold positions amid hopes of an increase in prices late in the season.

Floor brokers said higher new crop prices around Rs3,600 to Rs3,700 per maund sent a wave of optimism among ginners who still hold an unsold stock of about 0.4 bales on the perception that their stocks could be sold at higher levels.

“If spinners are inclined to go to a higher price limit for an uncertain crop as growers are facing a serious problem of shortage of irrigation water, why should they not opt for ready stocks,” they said.

They said that cotton economy had entered an interesting stage after recent forward deals and only spinners will be at the receiving end in the final analysis and will send SOS to the government to bail them out from the uneconomic cotton prices.

Indications are that if all goes well with the sowing operations of the Bt type seeds, there is every reason to believe that the next crop could be according to official projections, some others said.

No one could expect a lower crop, which is still being sown and push the forward prices so high without any cogent reasons, they said, adding, “honouring of the forward deals may be at stake at the time of delivery in August but chances of a default are always there.”

Meanwhile, after having fallen steadily during the last couple of sessions, including below 70 cent per lb barrier, the New York cotton futures staged a smart rally and were quoted higher by 1.37 and 1.40 cents per lb at 70.80 and 74.75 cents for both the ruling May and the new crop July contracts, respectively.

Official spot rates on the other hand were firmly held unchanged at Rs3,300.

Although some of the brokers reported stray business in the ready section, details were not immediately available from any one of them.