KARACHI, June 16: Trading in new crop resumed on the cotton market on Thursday as modest deal of 200 bales from a lower Sindh ginnery was sold at a high price of Rs8,400 per maund.

Unlike the previous season when the new crop made a debut at Rs4,200 per maund, the new season’s opening at double the last rate reflects that the sailing for the textile sector, notably on the export front may not be that smooth, market sources said, and added: “Last year’s average peak rate was recorded at Rs14,000 per maund.”

“Irrespective of global markets trend, even if the local new crop was billed as bumper one, there is no possibility of checking the future price flare-up,” they said.

Floor brokers said owing to higher cost of production, notably the recent sharp increase in urea prices to Rs1,300 per bag from the previous Rs900, the growers are eyeing the last year’s peak rate of Rs5,500 to 6,000 per 40 kg for their phutti (seed cotton).

Judged by any standard despite highly erratic future prices on the New York Cotton Exchange, the cotton season, that is just to make a debut, is expected to be stormy one both for the grower and the spinner, analysts said.

Market sources said some of the ginners in the central Punjab cotton belt have also resumed their new year operations and are expected to be in the market during the next couple of sessions and initially, they will honour the forward deals signed a
couple of weeks ago and after having made delivery as stipulated in the agreements.

New York cotton futures again ran into profit-selling and were marked down by 3.53 and 5.09 cents per lb at 151.96 and 133.45 cents for both the ruling July and the distant October contracts, respectively.

But on the other hand local official spot rates were again firmly held unchanged at the overnight level of Rs8,500 per maund.

The following are some of the deals reported by the Karachi Brokers’ Forum on Thursday:

1,300 bales Bahawalpur, 200 bales and 1,000 bales, mill-to-mill at Rs9,000, 1,265 bales, Rahimyar Khan at Rs8,800, 1,000 bales, Sadiqabad at Rs8,700, 150 bales, Uch Sharif at Rs8,650, 400 bales, Mailsi at Rs8,600, 294 bales, Dharanwala at Rs8,000, and 247 bales, Mirpurkhas at Rs7,850.