KARACHI, Aug 26: Cotton market on Thursday recovered from the previous lower levels as ginners raised their asking prices owing to a considerable fall in arrivals of phutti into the ginneries.

Most of the deals in the ready section were finalized at Rs2,300 to Rs2,325 per maund compared to the overnight rates of Rs2,200 to Rs2,250. The recent decline in phutti prices below Rs1,000 per 40 kg as compared to official support price of Rs925 seems to have forced growers to hold back phutti stocks to forestall fresh decline in its prices.

"The market talk of higher new crop estimates is, however, keeping the market unsettled for the last couple of sessions", brokers said "Growers who were dumping phutti into ginneries held back their ready stocks after the prices fell below Rs1,000-mark."

It is a good sign that near-normalcy has been restored to cotton trading after the last season's turmoil, they said adding "no ginner is inclined to take a risk even for a day after holding the lots as most of them had suffered heavy losses after prices fell to the current levels from the previous peak level of Rs3,650."

Grower too seems to have lost hope of last year's boom conditions when phutti prices soared to an all-time peak high of Rs1,750 per 40 kg against the official support price of Rs875. However, they are striving to get an economic price after holding back stocks of phutti temporarily.

The initial crop surveys conducted by both the private and the official agencies claim a higher crop as there is no serious pest attack in the major growing areas.

"Extremely hot weather and absence of monsoon rains in the entire cotton belt during the last about a month, the crop seems to have crossed the danger point", cotton analysts said and added that "perceptions are that the prices will remain on the lower side".

The other destabilizing factor was volatile price movements on the New York Cotton Exchange, which though had recovered from the 20-year lows of 42 cents to 50 cents per lb have failed to find a direction for both the futures, brokers said.

Official spot rates were further marked down by Rs25 at Rs2,225 per maund for the third session in a row. New York cotton futures also remained under pressure and fell by 0.71 and 1.22 cents at 50.24 and 50.77 cents per lb respectively.

Ready off-take was modest totalling about 5,000 bales, the following being some of the notable deals: 600 bales, Shahdadpur at Rs2,325, 400 bales, Shahdadpur at Rs2,300 and 400 bales at Rs2,325, 200 bales, Khipro at Rs2,300 and 1,400 bales, Samundari at Rs2,300.