KARACHI, Feb 27: Cotton prices on Thursday stayed firm above Rs2,500 per maund as spinners continued to build up long positions around these levels amid predictions of a short crop of below 10m bales.

After having risen to the current level of Rs2,450 because of persistent increase, spot rates were not changed and were held unchanged. In between, they had risen by more than Rs200 per maund, and cotton analyst Naseem Usman predicts the Rs2,600 level now appears to be just well within the reach of ginners.

Already a deal for 1,000 bales was finalized at Rs2,565 on credit basis, which reflects that spinners and mills have also kept this level in mind, he adds.

But spinners are worried over the developments on the world cotton market where prices are rising each session on strong support, followed by predictions of a short crop in the major cotton producing countries, including China.

However, spinners have welcomed the current halt in the price flare-up and hoped ginners will remain in an obliging mood and will not hold on to their unsold positions to push prices further higher.

“Strong presence of private sector exporters in the market are also adding fuel to the fire,” one spinner claims, adding if they could wait a little more to cover their forward positions, sanity could return to the market.

Unconfirmed reports claim some of the exporters have received fax messages and showed their willingness to buy lint at 60 cents per lb, market sources said.

But this rate appears to be on the higher side as it is about three cents per lb higher than the prevailing New York cotton futures for the ruling May contract, they added.

Moreover, exporters have to decide whether it is good for the country to sell it after adding value to it or as a raw material to Pakistan’s immediate competitors in the world textile trade, they said.

However, this is not to deny that the private sector exporters are receiving a fair amount of fresh import orders, notably from Bangladesh and some Far East countries at much higher rates.

Official spot rates remained stable at the overnight levels, and in physical trading most of the deals were also done at the previous levels.

Ready offtake was active as till late in the evening about 15,000 bales changed hand, the following being some of the notable deals:

SINDH TYPE: 5,000 bales from upper Sindh at Rs2,500 to Rs2,525; 1,000 bales, Rohri at Rs2,550 and 1,000 bales at Rs2,565 on credit; and 500 bales, Naushero Feroz at Rs2,500.

PUNJAB VARIETY: 2,000 bales from Rahimyar Khan at Rs2,500 to Rs2,525; 600 bales, Feroza at Rs2,525; and 1,200 bales, Sadiqabad at Rs2,500.