Pakistan is slated to record its slowest season of cotton production in 35 years, with ginneries struggling to achieve output of 6.5 million bales (of 170kg). It appears intuitive that the impact of poor crop performance on textile exports will be determined on pricing of imported cotton. But what exactly is the volume of Pakistan’s cotton demand?
Meanwhile, while cotton imports have increased, they haven’t increased nearly fast enough to keep pace with falling domestic output. Recall that as recently as FY15, Pakistan was producing 13-14 million bales of cotton annually, while importing 1.5 million bales on average to fill the supply gap. Output has since fallen to average 9 million bales, yet imports have increased by a million bales only.
Damage due to extreme weather only partly explains the low output. It is claimed that the ‘loss of cotton acres is not a loss to farmers’; they have indeed been forced to switch away from cotton, but not necessarily to less preferable crops.
The rate of cotton in Sindh was in between Rs 8400 to Rs 9400 per maund. The rate of cotton in Punjab is in between Rs 9400 to Rs 9700. Phutti of Sindh was sold in between Rs 3200 to Rs 4400 per 40 Kg. The rate of Phutti in Punjab is in between Rs 3800 to Rs 4800 per 40 Kg.
The rate of Banola in Sindh was in between Rs 1450 to Rs 1800 while the price of Banola in Punjab was in between Rs 1750 to Rs 2000. The rate of cotton in Balochistan is in between Rs 9100 to Rs 9300 while the rate of Phutti is in between Rs 3800 to Rs 4500.
The Spot Rate remained unchanged at Rs 9400 per maund. The Polyester Fiber was available at Rs 158 per Kg.
