October 22, 2003	Wednesday	Sha’aban 25, 1424

ISLAMABAD, Oct 21: Central Cotton Committee in its report has projected a shortfall of 1.4 million bales. This estimate is based on production of 8.2 million bales, as against the consumption, which is estimated as 9.6 million bales. The committee would submit its report to Federal Committee of Agriculture in its meeting on October 25.

On the other hand the world cotton faces a gap of 4.6 million bales in 2002-04 between production and demand, thus brightening the outlook for the growers/middlemen to reap substantially increased returns not only globally but within Pakistan as well.

The shortfall in world cotton is projected in spite of 5 per cent increase in output. As against 88.45 million bales produced in 2002-03, the production in 2002-04 is expected to rise to 92.8 million bales.

But the consumption too will go up from 95.69 million bales of last year to 97.4 million bales in the current year.

Consequently, the world stocks in 2003-04 are forecast to shrink to 35.8 million bales, 1.9 million bales lower than 2002- 03 stocks. This would be the lowest level in comparison with the past nine seasons.

The resulting scramble for securing supplies has translated into a sharp rise in the price of cotton - a process, given a dramatic stimulus by the likely import by China of 4.1 million bales in 2003-04, its position as the top-most producer of cotton notwithstanding.

As against 24.8 million bales produced in China in 2003-04, its consumption is likely to be of the order of 30.8 million bales. The China cotton index released on October 15, 2003, was equivalent to 91 cents per pound, when the New York Future (December contract) was 74.48 cents per pound and the Cotlook A Index 70.25 cents per pound.

According to China National Cotton Exchange E-trading, the average price as of October 17, 2003 for November delivery was 18094 yuan per ton or about 99 cents per pound.

As regards the domestic situation, the government had fixed the target of 2.86 million hectares for 2003-04. This acreage was projected to provide 10.55 million bales. The actual acreage, however, exceeded the target by 6.6pc and last year’s acreage by 9.3pc.

Up to August, the state of the crop was excellent and promised a bumper crop. But the observers had not reckoned with the vagaries of weather. Heavy downpour in July and August damaged the crop in some parts of Sindh and the Punjab.

ARRIVALS: In spite of, or because of the hurry to remove the cotton bolls from the field for fear of infestation of pests, the quantity of seed cotton received in ginneries was up by 41 per cent by October 15, 2003, as compared to previous year, according to the report received from the Cotton Ginners Association in the Ministry of Food, Agriculture and Livestock (MINFAL).

The quantities brought to the ginners by the growers by that date stood at 23,63,001 bales as against arrivals of 16,69,873 bales during the same period of 2002.

According to the report, the year 2003-04 has commenced with an opening stock of 1.782m bales (down 0.912m bales from the previous year’s opening stock 2.694m bales). This was buttressed by production of 10.200 million bales and imports of 1.110 million bales.