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Exporters make modest buying on cotton market

KARACHI, Jan 25: Cotton market on Friday passed through another lean session as spinners were again conspicuous by their absence awaiting apparently some fresh positive developments on the international textile front.

Exporters were said to be in the market and though their buying against their forward deals was modest, their presence imparted strength to the underlying sentiment, dealers said.

Another positive factor was that the TCP also offered to buy fine types of lint, notably contamination-free lots at much higher rates but details of their fresh purchases were not immediately available, they added. However, the presence of the both stabilized the market at the current price levels, although ginners are complaining about the lower rates offered by buyers.

"After having lost all hopes about an increase in prices in the near future, ginners are said to be out to cut their long unsold positions to save themselves from further losses," broker said. But inconsistency in mill buying limited the options before them as they only could come to their rescue being first buyers, they added.

They said although spinners still needed about 2 million bales to see the current year through, the same number being currently held by the ginners, but purchases at will have made things more difficult for them.

To keep an equilibrium between demand and supply spinners extend calculated support not allowing any undue price hike with a view to maintaining their export parity levels for the finished goods, market sources said.

Meanwhile, reports originating from the textile sectors, claim that world demand for the end-product of textiles, including cotton yarn is picking up as some of the leading importers have already opened letters of credit for the new quarter imports. The first quarter will end on March 31. However, spinners also complain about the large unsold stocks of cotton yarn lying in their godowns having negative impact on their liquidity.

It was perhaps in this background that ready off-take remained light totalling about 2,000 bales all from the Punjab ginneries as under: 600 bales of Sadiqabad at Rs1.700, 400 bales, D.G. Khan at Rs1,625.00 and 300 bales of Kabirwala at Rs1,300.

 

Courtesy Dawn January  26, 2002