KARACHI, May 31: Physical activity on the cotton market on Friday slowed down as spinners kept to the sidelines most of the time ahead of the release of final crop figures for the current season.
The Pakistan Cotton Ginners Association (PCGA) is expected to release the final crop figures by early next week, which will possibly set the future market trend as well as price outlook.
Holding sound statistical position after having imported over a million bales from various countries and lifting about 9.5m bales from the local market, spinners, brokers claim, are a little worried over the supply.
But what worries them is the phenomenon pressure on the supplies of the quality lint meant to produce higher counts of cotton yarn and for blending purposes, they said.
The fact that spinners are willing to pay as higher the price as Rs.1,800 per maund without 15 per cent sales tax reflects that they are short of the commodity and are willing to pay higher rates.
Although the TCP has lowered its purchase price from Rs.1,855 to Rs.1,550 per maund for almost the same quality, spinners are ready to pay more.
Whether or not ginners still hold a substantial number of bales of fine lint out of the expected unsold stock of 0.8m bales is not clear and only the PCGA figures due next week will tell, dealers said.
But one thing appears certain that those ginners who may have fine lots in their godown will get much higher rates as compared to the prevailing one, they said.
They said world prices have already touched the high mark of 40 cents per lb, which has made imports more expensive and as a result, spinners have to opt for local stuff to meet their immediate needs irrespective of the price tag.
“After keeping ginners at their toes most part of the current season, the cotton trade is now swinging in favour of those ginners who still hold stocks of a good quality lint,” cotton analysts said.
Meanwhile, reports coming from the cotton belts of upper Sindh and the Punjab indicate that sowing of the new crop is in full swing and in some areas where there was no shortage of water the operations have already been completed.
Official spot rates were, therefore, maintained at the previous levels but in physical trading fine lots were sold at much higher prices.
Ready offtake was light at about 2,000 bales, the following being some of the notable deals: 200 bales, Shahdadpur at Rs.1,350.00 and 1,000 bales, Bahawalpur at Rs.1,700.00.