LAHORE: The Trading Corporation of Pakistan (TCP) has made the purchase of cotton from ginners subject to the approval of the Economic Coordination Committee (ECC) as the domestic cotton market is witnessing an unusual decline in the prices of the commodity, which may lead to a record reduction in cotton cultivation next year.

The Federal Committee on Agriculture has reduced the cotton production target from 12.7 million bales to 11.5 million bales.

Cotton Ginners Forum Chairman Ihsanul Haq said in a statement on Friday that both federal and provincial governments had declared 2023-24 as the year of “growing more cotton” and appealed to farmers to cultivate as much crop as possible for the sake of saving the local textile sector. They had fixed an intervention price of Rs8,500 per 40kg to save the cotton growers from any losses if the market went down from this level.

The federal government also promised to introduce the TCP as an active player in the market to stabilize the prices by purchasing one million bales of cotton from the ginners.

He said that during the last three weeks, cotton prices in the domestic market had decreased by Rs6,000 to Rs16,000 per 40kg, while the phutti or raw cotton prices had come down to Rs7,000 per 40kg, and the textile millers further depressed the market sentiment through their lack of interest in buying cotton.

He said that on behalf of farmers and cotton ginners, demands were being made on various forums from the federal government for immediate purchase of cotton through TCP, and the Federal Ministry of Commerce held a meeting on this issue but with no decision.

He claimed that the participants of the meeting were told that billions of rupees would be required for the purchase of one million bales of cotton from ginners by the TCP, and these could be released only after approval by the ECC. This, he said, has delayed the buying of cotton by the TCP, due to which the prices of cotton in the open market would further decline, causing a severe depression among the farmers.

He warned the authorities concerned that dejected farmers would refuse to cultivate cotton next year, and the government would be forced to import cotton as well as edible oil worth billions of dollars.

Published in Dawn, October 14th, 2023