KARACHI, March 13: Physical activity picked up modestly on the cotton market on Thursday, as spinners covered their forward positions, but they are not inclined to go beyond their parity levels owing to highly competitive foreign textile market.
About 10,000 bales changed hands in the ready section depending on quality, but fine lots were mostly traded around Rs3,450 per maund.
Some of the mills and spinners who have bid in the auction of Seed Corporation of Pakistan for 7,000 bales, lifted the entire stock at Rs3,400 and 3,610 per maund.
Earlier in the session, the sluggishness overtook the market after ginners raised asking prices in line with the world prices but spinners and mills were not in an obliging mood. In the evening, spinners were back in the market and lifted all the offered lots, floor brokers said.
Unlike the brisk activity during the previous couple of sessions, ready business shrank to a modest proportion as price ideas of buyers and sellers were polls apart, they said.
New York cotton futures, which generally set the global price trend, stayed well above the 80 cent per lb mark and rose modestly, but there was no limit-gain in any of the forward contract, they added.
Both the active May and the forward July settlements were quoted further higher by 0.78 and 1.50 cents per lb at 82.06 and 84.61, respectively, as fears of a further pressure on supplies towards the end of the current season could push prices again higher, spinners apprehended.
One thing is, however, clear that future price outlook may remain bullish as world demand for lint is said to be much higher than the total supplies.
Although the ‘hide and seek’ game between spinners and ginners managed to contain a widely speculated price flare-up based on a short crop, the next couple of weeks will show how parity levels are maintained by the spinners and mills in short crop, amid higher world prices and some problems on the import front from India against firm letters of credit, market sources said.
There was no change in the official spot rates, which were firmly held at Rs3,350 per maund for an average quality of lint.
Mills ready off-take was modest, totaling about 10,000 bales as under: 3,000 bales, upper Sindh at Rs3,450, 900 bales, New Saeedabad at Rs3,375 to Rs3,400, 1,000 bales, Daulatpur also at this rate, 1,000 bales, Shahdadpur at Rs3,400 and 1,200 bales, Jehanian at Rs3,325.
