October 26, 2020

Weekly Cotton Review Fluctuation of rates observed.

Fluctuation was seen in the rate of cotton. Bearish trend was seen in the rate of Khal and Banola. Majority of the ginning closed there operations in the middle of the season due to the extraordinary decrease in the production of cotton.

 Private sector is ready to take steps for the increase in the production of cotton. It’s now or never like situation for the cotton crop. There is a need to focus on increasing the production of cotton.

 

In the local cotton market during the last week both ginners and textile and spinning mills were involved in cautious buying because the rate of Phutti increased considerably. Ginner is not ready to bear the loss by selling the cotton on fewer rates. The ginners were not ready to do business in loss so a significant number of ginning factories have also closed. Some ginners were running their factories cautiously. On the other hand almost all the ginning factories in Sindh from Hyderabad to Nawabshah were almost closed. Almost all the ginning factories of Sanghar which is the biggest cotton producer were closed. Some ginners closed their factories after selling their Phutti on high rates. The trading volume of cotton trade is decreasing. All the big groups of textile are importing while some mills are buying cotton from the local market.

 

The rate of cotton in Sindh is in between Rs 8600 to Rs 10,200 per maund. The rate of Phutti is in between Rs 4500 to Rs 5200 per 40 Kg. The rate of Banola is in between Rs 1650 to Rs 2000 per maund. The rate of cotton in Punjab after reaching in between Rs 9800 to Rs 10,500 per maund but after decreasing it was available at Rs 10,300. The rate of Phutti reached in between RS 4700 to Rs 5500 per 40 Kg. The rate of Banola is in between Rs 1750 to Rs 2200. The rate of cotton in Balochistan is in between Rs 9500 Rs 9700 while the rate of Phutti of good quality is in between RS 5000 to Rs 5600 per 40 Kg.

 

The Spot Rate Committee of the Karachi Cotton Association has increased the spot rate by Rs 300 per maund and closed it at Rs 10,100 per maund.

 

Chairman Karachi Cotton Brokers Forum Naseem Usman told the overall bullish trend was witnessed in the international cotton markets. The rate of New York Cotton market after increasing reached at the highest level of 70 cent to 71 cent. According to the weekly USDA export report increase of 130 percent was witnessed. Pakistan was the biggest importer after importing 93000 bales. The rate of cotton remained stable in Argentina and Sudan while the increasing trend was witnessed in the rate of cotton in India. There are chances of increase in the rate of local cotton market due to the increase in the rate of however there are no chances of decrease in the rate of cotton in near future.

 

The rate of cotton is increasing as compared to dollar this will have bad impact on the export of textile products. On the other hand cotton will be imported on fewer rates as compared to local cotton.

 

The government has formed a task force headed by group leader All Pakistan Textile Mills Association Gohar Ijaz. The objective of forming the task force is to improve cotton production. The government has inducted five textile mill owners in this task force who played their role for increasing the cotton production in the country. Gohar said that it is the high time that private sector should play its role in increasing the cotton production in the country. The task force will take help from farmers, researchers, scientists and stake holders. He said that task force has started its work and contacted experts from all major cotton producing countries in the world except India. It is expected that more than two dozen cotton experts from around the world are arriving in Pakistan in November.

 

Gohar Ijaz while talking to chairman Cotton Brokers Forum Naseem Usman told that time has come that instead of relying on government private sector should take steps and played its role for increasing in the product of cotton. He said that previous governments of Nawaz Sharif and Zardari and present government of Imran Khan had not taken practical steps for increasing the production of cotton. He further said that by the Grace of God textile sector is getting export orders in sizable number and textile sector is fully operational.

 

Naseem Usman appreciated the resolve of Gohar Ejaz and said that time has come that practical steps should be taken to increase the production of cotton.

 

On the other hand chairman Pakistan Cotton Ginners Association Dr Jassu Mal is holding meetings with high ups on daily basis and requesting them to take steps for the provision of good quality cotton seeds. Without the availability of good quality seeds the increase in the production of cotton is impossible. During his meetings with high officials he insisted that support price of cotton should be announced.

 

Moreover former chairman FPCCI has shown his reservation on the decrease of cotton production while pointing out other issues during the meeting of KATI.

 

During the meeting of Federal Committee on Agriculture the land for the production of Kharif crop was determined. In the meeting which was chaired by Minister for National Food Security Syed Fakhar Imam told that production land of almost all Kharif crop was increased. While expressing his views in the meeting Fakhar Imam said that production can only be increased by using good quality seeds and modern technology.

 

He said that production of sugar cane and rice was satisfactory while the cotton crop was affected due to the attack of Pink Ballworm and White fly. Support price of other Kharif crop was settled during the meeting but there was hardly any discussion on cotton.