THERE was no let-up in price spiral which has gripped the Karachi wholesale markets for the last couple of months, and prices of essential items shot up, despite an improvement in ready supply position on some counters. Market sources said duty-free import of wheat during the next couple of months was expected to stabilise prices at lower levels, which had risen to an all-time high.

The physical business, however, was shrinking each day as purchasing power of the general consumer was diminishing gradually as some of the essential commodities had attained inhibiting levels, floor brokers said.

The price hike again remained confined to the rice and pulses sectors owing to higher exports and imports in that order, supply outlets being in the hands of few, they added.

Although no rice loaders called on the port during the last couple of weeks as some exporters might have differed their shipment deadlines to new crop, there was no respite in prices for the consumers.

According to local sources profit margins on rice both IRRI and fine type are much higher than c.i.f export value of the commodity, private sector exporters claimed to have opted for the local market.

Some others said the commodity was in short supply as bulk of the surplus had already been shipped to various destinations, which had caused price hike on the local markets.

“The commodity trade has slipped into the hands of speculative traders who are not inclined to loosen their grip over the selling prices, and are regulating them in line with the profit margins,” market sources said.

What seemed to have aggravated the price situation were reports of forward trading in some essential commodities on daily basis as speculative traders left with bags full of money without giving or taking physical possession of the commodity in trade, they said.

However, the satisfying feature of the week’s trading was fresh decline in prices on selling prompted by reports of steady arrivals of new crop from upcountry markets and partly to larger release of official stocks to flour mills.

But incidentally, the fall in wheat prices was not reflected in flour prices, which continued to be sold at higher levels, mainly at retail level, dealers said.

Sugar prices also maintained their upward drive for the third consecutive week apparently in sympathy with other essential items as pressure continued to mount on the ready supplies followed by reports of holding back of stocks by mills.

The market advance was again led by rice sector where prices of IRRI types recorded the highest rise of Rs1,800 to Rs2,000 per bag of 100 kg followed by basmati which also rose modestly.

But late in the week, IRRI-6 and Sela type came in for active selling followed by reports of steady arrivals from upcountry markets and partly to slack consumer demand at higher prices and fell by Rs200 to Rs1,200 per bag. IRRI broken rose by Rs200 on export demand.

Active trading was, however, witnessed on the pulses sector where masoor whole and dal were quoted higher by Rs1,400 and Rs500 to Rs600 per bag of 100 kg.

Peas and urad varieties, on the other hand, were marked down by Rs50 to Rs100 on dealers selling amid falling ready demand from retailers.

Sugar prices in sympathy with other essentials rose by Rs170 to Rs200 per 40 kg followed by gur, which was quoted higher by Rs100. Desi sugar was held unchanged. Among other essentials, wheat showed a modest fall of Rs100 per bag but dealers said it could decline further after official steps to bring its prices down.

Among major industrial raw materials, guar seed remained in active demand and rose by Rs125 to Rs200 per bag but other types were held unchanged.

Cereals, on the other hand, remained in strong demand and were quoted higher by Rs125 to Rs200 per bag of 100 kg on active local buying amid reports of slow arrivals from upcountry markets.

Baring castor seed and til, which suffered fall ranging between Rs200 and Rs400, other seeds including cottonseed and rapeseed were firmly held unchanged. Cotton prices, on the other hand, were quoted higher by Rs50 per maund amid active trading.

Oilcakes ruled unchanged for rapeseed cakes, while cottonseed cakes showed a modest fall of Rs25 on selling.—M.A.