KARACHI, Aug 28: Cotton market finished the weekend session on a steady note as both ginners and spinners remained locked in price war but the former maintained an upper hand.
"The market appears to be totally immune to the international price trend as supply and demand remained dominating force behind the daily trading", analysts said.
Even official import figures of 2.173m bales since last August up to June 30, did not affect the local price line as ginner perception is that mill consumption during the current year is expected to touch the high mark of 14m bales, they said.
Together with resumption of operations by over a 100 sick textile units, the textile industry as a whole has injected about Rs70bn in expansion and modernization of the existing capacity.
As a result, the annual consumption has swelled to a record figure of 13m shares and it is expected to rise further during the current season as was reflected by panic local buying and continued imports.
To make up the local crop shortfall of the last season, spinners and mills had made emergency imports all through the year and were still in the import business apparently awaiting the final crop figure.
However, it is speculated that the crop is expected to be in line with the official as well as private estimate as was reflected by the pace of arrivals of phutti into the ginneries and a steady decline in lint prices, dealers said.
Meanwhile, reports originating from the textile sector indicated that export demand of cotton yarn was progressively picking up, although prices offered were a bit lower.
During the last couple of weeks yarn prices had fallen sharply both on the local and foreign market, which has caused sharp increase in inventories and liquidity problems for the spinners, industry sources said.
Official spot rates consolidated the overnight gains and were held unchanged but on the other hand New York cotton futures suffered fresh decline ranging from 0.50 to 0.64 cents at 47.90 and 48.44 cents per lb for both the ruling October and the forward December settlements respectively.
Ready business was active totalling about 10,000 bales including those lots traded late last evening. The following are some of the deals, which were done on Saturday evening:
SINDH VARIETY: 200 bales, Mirpurkhas at Rs2,275, 200 bales at Rs2,300, 1,000 bales, each Tando Adam, Jhole and Shahdadpur at Rs2,350.
PUNJAB TYPE: 600 bales, Sahiwal at Rs2,275, 200 bales, each Chichawatni and Arifwala at Rs2,300, 200 bales, each Jhang, Gojra and Shorkot at Rs2,250, and 600 bales, Burewala at Rs2,300.