KARACHI, Jan 21: Trading on the cotton market remained slow as ready demand did not pick up in the absence of leading spinners who appear to be more worried over the piling of unsold yarn stocks rather than buying lint at the lower rates.
The other contributory positive factor was higher crop ideas and larger unsold stocks of lint with the ginners ensuring adequate supplies in the weeks to come, dealers said.
What seems to have encouraged them to be too choosy was the reports that the official crop assessment committee has, in its recent meeting, stick to its previous crop estimate of 10.4 million bales, 8.1 million and 2.2 million bales in Punjab and Sindh respectively.
It also endorsed the phutti arrival figures of 8.424 million bales released by the Pakistan Cotton Ginners Association for the fortnight ended Jan 15, 2002, which allayed fears of any shortage at least for the current season.
But the committee assumes some of the leading growers are still holding stocks of phutti to get higher prices. They held on to their stock after the recent price decline.
Floor brokers said late entry of exporters in the market also went against the ginners as being a first buyers, mills and spinners made guarded purchases apparently to keep prices within the international parity levels.
Owing to larger unsold stocks, ginners are worried over the developing situation and until mill demand picks or the TCP come to their help, the phenomenon of falling prices may not be averted.
Market sources predict the month of February could be crucial for the future direction of the market as by that time spinners and mills will finalize their next quarter export deals and may revert to market to cover forward positions.
They are also worried over an alarming decline in mill demand, which could cause panic selling from the ginners in the coming weeks.
Meanwhile, New York cotton futures seem to have lost relevance to local spot rates, which are being quoted at discount for the last several days.
Ready offtake was, therefore, modest as till late in the evening about 4,000 bales changed hands as under:
SINDH TYPE: 500 bales, Sanghar at Rs1,600.
PUNJAB VARIETY: 1,000 bales, Sadiqabad at Rs1,725 to Rs1,750, 1,000 bales Rahimyar Khan at Rs1,725 to Rs1,750, 200 bales, Burewala at Rs1,300 and 200 bales, Sahiwal also at Rs1,300.