KARACHI: Cotton imports almost doubled crossing $1 billion during the first half of 2020-21, convincing stakeholders that the figure could even reach $3bn by June 30.

The recently updated State Bank of Pakistan (SBP) data showed that the country imported cotton worth $1.029 billion during July-December FY21 as against $543m in the same period last year.

The Pakistan Cotton Ginners Association (PCGA) this week reported that the cotton production fell to 5.571 million bales up to Jan 31, a shortfall of 2.9m bales over the same period last year.

The millers claim that they would need to import 7.5m bales this year to meet requirements, but experts said the figure is exaggerated.

The consumption of cotton by the textile industry could be in the range of 10.5 to 11 million bales, which has largely unchanged over the past decade’s pattern. However, the modest year-to-year increase reflects a higher domestic crop tempered by inflated prices.

Cotton cultivation area has decreased from 2.86 million hectares in 2011 to 2.48 million hectares in 2020. Production has decreased from 11.13m bales in 2011 to 8m bales in 2020.

However, traditionally the second half of fiscal years witness higher cotton imports.

Nasim Usman, a cotton sector expert, said the country could see total imports of $3bn to $3.5bn in FY21. So far, the cotton production is at a 30-year low and if the pace of phutti arrivals remains the same the country could face a shortfall of 4.5 to 5m bales.

Yield was expected to be higher than last year based on sufficient water and availability of certified seeds, but the situation got worse due to pest attacks and heavy rains.

Published in Dawn, February 6th, 2021