Raw cotton prices on Thursday touched the current year’s highest level of Rs 2,900 per maund (37.24 kilograms). The Rs 100 per maund rise in the price was attributed by the traders to the late arrival of fresh cotton crop due to monsoon rains.

Rising cotton demand and its low stocks have spurred raw cotton prices at the highest level of not only of the current year, but is also the highest rate witnessed during the last two years, they added.

"Yesterday, market opened with cotton transaction of Rs 2,800 per maund at Karachi Cotton Exchange (KCE), but later a deal was finalised by a Shujabad ginning factory at the highest rate of Rs 2,900 per maund and a miller has bought some 400 bales on highest rate," a senior trader said.

He said that cotton crop had been delayed around 20-30 days due to incessant monsoon rains in Punjab and Sindh provinces. "We were expecting new cotton crop in the second week of July, but now it is expected to arrive in the first week of August," he added. He said that raw cotton price had surged up by Rs 100 per maund from Rs 2,800 to Rs 2,900 per maund, the highest price of the current season.

Earlier in April, the prices of raw cotton touched Rs 28,00 per maund-mark.

During the current year, the country missed its cotton production target of 13 million bales by 0.6 million bales, as the total production stood at 12.4 million against the consumption of 15-16 million bales, therefore, the country is facing a deficit of over three million bales. Low production and delay in the new crop has created some panic in the domestic market, which has pushed the prices towards the highest peak.

"Cotton season for 2006-07 is going to end and now only 40,000-50,000 bales’’ stock is available in the ginning factories, therefore, the millers are trying to buy cotton to meet their demand," Naseem Usman, a leading trader said.

Main reason behind the rising prices is the limited stock of cotton, besides its rising demand in the country, he said, and added if the arrival of new crop was further delayed, then its prices could also further go up in near future.

During the current cotton season, raw cotton prices had gone up by Rs 400 per maund, as its prices, at present, stood at Rs 2,900 per maund as compared to Rs 2,500 per maund last August, he said.