LAHORE: At least 200,000 bales of cotton are lying with the ginners despite a 32 percent less lint production than the target and a delay in the beginning of the new crop year.
As per data released by the Pakistan Cotton Ginners Association (PCGA), a total of 8.393m bales of cotton were received by the ginning factories across the country till Feb 29, which is 72pc more than the previous year but a record 32pc less than the official target.
Cotton production in Punjab remained 43pc more and in Sindh a record 119pc more than the last crop year.
Textile mills have so far purchased around 7.892m bales and exporters 293,000 bales, but more than 200,000 bales are still available for sale with the ginning factories.
Pakistan Cotton Brokers Association secretary Sundas Ayub says a stock of 0.2m bales apparently appears to be too small in view of the time to start a new season, but lean demand amid poor economic situation is keeping the business activities at low ebb.
Explaining the crisis, Cotton Ginners Forum chairman Ihsanul Haq says that besides overall national economic slowdown, the textile sector is facing a severe financial crisis because of higher production cost due to soaring power and gas tariff as well as a steep hike in taxes on the industry.
He says there is a wave of serious concern in the sector, as there is also an unusual delay in cotton cultivation in most of the cotton zones across the country for the next season due to extremely adverse weather conditions.
He says that the newly-formed federal government should immediately announce a cut in electricity, gas and loan markup rates for the export textile sector to help recover it, recalling that the SIFC had approved the reduction in power rates from 14 cents to nine cents for the export textile sector.
Cotton trading in Pakistan remained quite limited during the last week, with prices ranging between Rs21,500 and Rs22,000 per maund, while the New York Cotton Exchange saw an unusual trend during which cotton prices reached the highest level of one dollar and three cents per pound before falling back to 95.57 cents.
Mr Haq says that cotton sowing is being severely affected due to the record low temperature because of rains along with Sindh’s coastal districts of Badin and Thatta, as well as in most of the cotton zones of Punjab.
Meanwhile, the final cotton production data will be released on April 3, 2024 instead of March 18, 2024, and it is expected around 30,000 more bales will reach the ginners during this one month.
On the other hand, the Federal Committee on Agriculture usually releases cotton production figures and fixes production target for the next crop year as well as its intervention price in the second week of February every year. But, it has not met yet this year though the month of March has begun.
Published in Dawn, March 4th, 2024
