April 1, 2019

Weekly cotton review prices remain stable trading volume increases.

The prices of cotton remained stable. The trading volume increased.

Due to increase in dollar and interest rate and the news of increase in the prices of energy economic activity was literally stopped. In the local cotton market during the last week the increase in buying was witnessed by textile and spinning mills and due to ginners' interest in selling the prices of cotton remained stable while prices of low quality cotton were increased due to which the trading volume increased.


The prices of cotton in both Sindh and Punjab remained Rs 7000 to Rs 8850 per maund while the price of Seed cotton (Kapas/Phutti) is from Rs 3000 to Rs 3600 per 40 Kgs in both Sindh and Punjab. Cotton in Balochistan is available at the rate of Rs 7800 to 8100 per maund while Phutti is not available. The Karachi Cotton Association (KCA) spot rate committee stabled the spot rate price at Rs 8600 per maund despite fluctuations in spot rate.


The Karachi Cotton Brokers Forum said that economic activity came to a virtual stop as the business community was not showing interest due to the increase of Dollar against Pak Rupee and the increase of interest rate by 50 paisa and due to the news of increase in the prices of energy. The business community was not signing any import and export agreements; moreover, they were reluctant to sign any new deal in local market due to which the economic activity was stopped. Uncertain situation was seen in the market of textile products and cotton yarn. It said that stock of 8 lac 50 thousand bales was left with ginners. He said that partially sowing of cotton was started in lower Sindh. The sowing of cotton will start in the areas where harvesting of wheat will be completed.


It is expected that cotton production will increase in the coming season as the farmers got ample amount of water as well as they got reasonable price of Phutti.


The agriculture department is working harder to increase the production of cotton as Prime Minister Imran Khan has shown his resolve of increasing the production of cotton by 15 million bales. The Punjab government is working harder to increase the production of cotton and the government functionaries were conducting seminars to raise awareness among the farmers regarding increased cotton production. The production of cotton in Sindh is satisfactory but it is expected that production of cotton will increase because last year's cotton crop in lower Sindh was affected due to shortage of water. It is expected that this year there will be no shortage of water in lower Sindh.


Moreover, Agriculture College Bahawalpur organized a seminar in which experts briefed the farmers about the use of modern technology. In the meeting Cotton Commissioner Director Dr Khalid Abdullah said that government is taking practical steps towards increasing per acre production of cotton.


President Pakistan Kissan Ittehad Khalid Khokhar has said that the government should take steps towards restoring the trust of farmers for an increase in the production of cotton. He proposed that government should fix the price of Phutti at Rs 4000 per 40 Kg. He also proposed that government should reduce its reliance on imported cotton and buy cotton locally in order to encourage farmers and ginners.


The association said after fluctuations in prices in international cotton market overall increase in price was witnessed. A fluctuation was witnessed in New York Cotton Market due to fluctuation in New York Cotton Rate of Promise (Waday Ka Bhao), weather conditions, fluctuations in Dollar, contradictory news regarding the US-China trade conflict and news of reduction of cultivation of cotton land.


According to the report of USDA, the export of cotton increased by 75 % as compared to last week while shipment was also increased due to which the prices of cotton should have been increased but the prices were decreased. The prices of cotton witnessed an increase of 1.75 American cents on Friday as USDA gave the news of decrease of 2 % sowing as compared to last assessment.


The prices of cotton remained stable in China while the prices of cotton over all increased in India. Locally the trade volume of business of cotton yarn and textile products increased however the rate remained stable. Due to the news of increase in the price of dollar against Pak Rupee the rate of cotton, cotton yarn and textile products remained stable.