KARACHI, Sept 18 Cotton prices on Thursday fell further by Rs50 per maund as leading ginners continued to liquidate their long positions despite reports of a short crop of about 12m bales well-below the revised target of around 14m bales.

An idea of panic-selling may well be had from the fact that some of the deals were finalised as low as Rs3,900 per maund, although most of the fine lots were traded around Rs3,950, mostly from the Sindh ginneries.

The interesting feature was that the New York cotton futures were back on the rails after having suffered massive fall below the 60-cent per lb in the backdrop of bankruptcy of US investment bank, Lehman Brothers, local market ran into deeper recession owing to local factors, floor brokers said. “A wave of optimism prevails among the spinners and the mills after the lint prices fall below the recent benchmark of Rs4,000 per maund,” said a leading cotton analyst Naseem Usman.

“Heavy daily mill intake reflects that the local rates are now in line with their export parity levels,” he added.

Prices may ease further, but spinners are not inclined to take even a calculated supply risk at this stage and are indulging in big-lot business mostly in Sindh type, he added.

Phutti rates were also easing off in the back drop of falling lint prices and the interesting feature was that growers were not inclined to hold onto their long positions and were selling at the spot rates, some floor brokers said.

They said the current price fall appeared to be psychological rather than real amid conflicting opinions about the crop size.

Official spot rates were lowered by Rs50 per maund in line with ready prices and were last quoted at Rs3,950.

New York cotton futures on the other hand staged smart rally and were quoted higher by 1.04 and 0.81 cents per lb at 59.36 and 61.42 cents, for both the ruling October and the distant December contracts respectively.

Mill ready off-take was on the higher side amounting to about 30,000 bales, the following being some of the notable deals

SINDH VARIETY 3,000 bales, Shahdadpur, 2,000 bales

Tando Adam, 1,000 bales, Sanghar, at Rs3,925 to Rs3,950, 2,600 bales, Mirpurkhas, at Rs3,850 to Rs3,900, 1,000 bales, Nawabshah, at Rs3,950 to Rs3,975, 400 bales each, Shahpur Chakkar and Jhole at Rs3,925 and Rs3,950, 600 bales, Hyderabad, at Rs3,900 to Rs3,925 and 400 bales, Shahdadpur and 1,000 bales, Tando Adam at Rs3,900 delivery after Eidul Fitr.

PUNJAB TYPE 1,000 bales, Haroonabad at Rs3,925 to Rs3,975, 400 bales, each Bahawalnagar and Rahimyar Khan at Rs3,915 and Rs3,975, 400 bales, Sahiwal at Rs3,965, 200 bales, Khanpur at Rs3,960, 200 bales, Layyah at Rs3,950, 400 bales, Depalpur at Rs3,900 to Rs3,925, 200 bales, each Hasilpur, Chistian, Burewala, Okara and Khanewal at Rs3,950, 200 bales, Muridwala at Rs3,925, 200 bales, each Mian Channu and Ariwala at Rs3,900.