MULTAN, Aug 5: The governments of Punjab and Sindh have yet to amend their respective Cotton Control Act, 1966, in line with the Cotton Standardization Ordinance, 2002.

This is pointed out in a working paper prepared to present in the fourth meeting of the board of directors of the Pakistan Cotton Standard Institute. "The provincial agriculture departments have stated that the required amendments in the act are under process," the paper says.

The meeting was scheduled for August 4 in Karachi but was postponed in the eleventh hour. It was not the first time that the fourth meeting of the PCSI board had to be postponed due to what officials said some other pressing engagements of the federal ministry of food and agriculture authorities. The meeting, which has been due since May 1, had been put off twice previously.

According to the Cotton Standardization Ordinance (CSO), the PCSI board of directors should meet twice a year and the intervening period between the two meetings should not be more than six months. The last meeting of the PCSI board was held on November 1, 2003.

The Punjab and Sindh governments were asked by the PCSI board to amend the CCA (Cotton Control Act) in its third meeting, but even after the passage of nine months the proposed amendments are still 'under process'.

To fashion the grading system in the domestic cotton market, the PCSI board of directors had advised the two provincial governments to make it mandatory through amendments in the CCA that the ginners should mark each and every bale of cotton with its grade and staple length.

Despite the fine quality of its fibre, the Pakistani raw cotton is offered less price in the international market owing to lack of gradings and relatively high presence of non-lint contents. The CSO was issued by President Pervez Musharraf in October 2002 to ensure ginning of standardized cotton in the country.

Cotton market analysts say that coming cotton arrival season in the country warrants that the standardization should have been in place before the advent of picking in the fields so that in case of any unusual conditions in the wake of prevailing low cotton prices coupled with an expected bumper crop, the Pakistani raw cotton may fetch competitive prices in the international market.

Analysts see a cotton marketing crisis this year, especially in case of a surplus crop because where the spinners have reportedly consolidated their position to dictate terms by excessively importing raw cotton, and the ginners are poised to keep the phutti (cottonseed) prices low to cover the losses they incurred in the gamble to stock around 250,000 bales of cotton in the hope that they would exploit the situation emerged due to a short crop last year as compared to the demand, especially in the backdrop of high cotton prices during the season.

The Pakistan Cotton Ginners Association has announced that the ginners will not procure phutti from the fresh crop until disposal of their unsold stocks worth Rs5 billion. The PCGA has been demanding that the Trading Corporation of Pakistan should lift the cotton stocks lying unsold with the ginneries from the previous crop.

Although the federal cabinet has decided that TCP will procure 0.1m bales of cotton to ensure implementation on 'cotton support price policy', it remained to be clarified that whether the corporation will procure the cotton bales from the previous crop or it is mandated to enter the market for the coming season.

However, in a recent statement TCP chairman Masood Alam Rizvi has said that the public sector will come in the market only to not let the cotton prices fall below the official procurement price, which for the coming season is Rs925 per 40kg.