KARACHI, March 22: The cotton market on Saturday finished the week on a dull note as both buyers and sellers remained locked in a price war but it appears to be a no-win situation.

Unlike the previous session, the chief casualty again was the ready business as spinners were not inclined to bid around Rs2,700 per maund, while ginners were unwilling to sell below this level as far as the fine lots are concerned, dealers said.

Being at the receiving end partly owing to reports of a short crop and partly to expensive foreign lint, spinners are trying to cover their forward positions below Rs2,700 per maund, they said.

But what worries them is an expected shortfall in the total crop and its bullish impact on the price line after the almost final figures are released during the first week of the next month by the Pakistan Cotton Ginners Association (PCGA).

Some leading brokers speculate the unsold figure of lint with the ginners up to March 31, could hardly touch the high mark of 0.7m bales, far below the monthly consumption of the textile sector.

During the current year, monthly consumption of the organized textile sector has soared to 0.9m bales as compared to around 0.8m bales previous year as over a 100 sick mills had resumed production after a lot of modernization and balancing operations.

The other disturbing factor is that prices of polyester fibre have also shown a sympathetic rise adding significantly to production costs and making export more expensive.

Spinners said the ratio of polyester fibre in cotton for blending purposes to produce blended cloth has in the recent past risen to about 30 per cent and both the expensive inputs has worked against their export competitiveness.

Meanwhile, consignments of lint from foreign sources under the previously signed contracts are steadily arriving both at the Karachi Port and the Port Qasim, the total being 0.339m bales since Sept 1, 2002 up to March 15, 2003 which also included 4,484 bales during the last couple of days.

Having a fair idea of the total crop, leading spinners have made forward deals for half a million bales from the various foreign sources around 50 cents per lb, shipments against them are well underway, brokers said, although they failed to contained the local price flare-up.

There was no change in the official spot rates, which were held unchanged but New York cotton futures on the other hand showed a fractional fall of 0.2 and 0.3 cents at 58.78 and 59.48 cents per lb for both the ruling May and the distant July settlements respectively.

Ready offtake was light as till late in the evening only 2,000 bales from the upper Sindh ginneries changed hands, the following being some of the notable deals: 800 bales, Gothki at Rs2,625 and 400 bales at Rs2,650, 200 bales, Dharki at Rs2,640 and 200 bales at Rs2,650.