SPOTLIGHT ON CURRENT COTTON POSITION
Aug 27 - Sep 02, 2007
Cotton is the most important textile fiber in the world and because of its value and value addition, it is called silver reed. It accounts for over 40 percent of total world fiber production. Some 80 countries of the world produce cotton, of which the United States, China and India together provide over half the world's cotton. The U.S. has been ranking second to China in production and has been a leading exporter of this commodity.
Pakistan is the 4th largest producer of cotton in the world and the 6th largest importer of raw cotton, the third largest consumer of cotton, and the largest exporter of cotton yarn. Over 1.3 million farmers, out of a total of 5 million are involved in cultivation of this crop. Pakistan is one of the largest cotton producing and consuming countries in the world. It has the potential of becoming a leading force in the worldwide cotton and textile market place. Of course, there is realization in the country that future gains in value added from cotton would only be possible by qualitative improvement in raw cotton, as well as in improvement of cotton production to meet the ever-increasing requirements of our textile industry. Cotton accounts for 8.6 percent of the value added in agriculture and about 1.9 percent in GDP. Minister for Food, Agriculture and Livestock, Sikander Hayat Bosan during a question-answer session of the National Assembly informed that despite attack of milli bug, the cotton production this year is expected to register 8 percent increase. He said that expectedly there would be 6 million bales shortage of cotton in the world, not in Pakistan. According to him in the United States of America and Brazil there would be some 19 and 12 percent fall in cotton production, due to fall in the cotton cultivation area in these countries. Optimistically, he stated that Pakistan would achieve its target of 1,4000,000 bales. At the same time he said it was too early to say that Pakistan would (definitely) achieve this target. He assured the attack of mili bug on cotton crop in Pakistan was under control and that the Ministry was trying to control the disease by biological methods. He also assured that a recipe of pesticides has been prepared for controlling pests, while a fabulous amount of Rs.20 billion has been spent by the government over subsidies for the fertilizers. He also re-assured that the policy for these subsidies would continue. To appease the farmers, he assured that if an area is declared calamity hit by the provincial governments, agri loans would be written off by the Banks. Regarding import of cotton, he stated that as per decision of Economic Co-ordination Committee of the Cabinet, only those varieties would be imported, which are not grown in the country. The government should admit that cotton is the most important crop for Pakistan as it runs the wheel of the economy of the country. Its increase in production, quality-wise and quantity-wise, must boost export of cotton, textiles and garments in the international market. Of course, Pakistan has the potentials to be amongst the world top exporters of clothing and other cotton products of value addition.
FEATURES OF PAKISTAN COTTON
Pakistani cotton is one of the best in the world and has comparative advantage in its production, due to the most suitable soil and climate. Thus Pakistan enjoys an edge over other countries. Some of the important characteristics of our cotton are as under:
Ginning out turn (GOT)
4.4 to 4.5 micro/inch
Strength of fiber
98 to 99 lbs/sq. inch
up to 50 count
Use of pesticides
Within limits, not injurious for human use.
Pakistan's cotton is regarded as the best among varieties of cotton of similar staples grown elsewhere in the world. Pakistan's cotton industry enjoys several advantages over those of many other countries as far as the production of quality fabric and yarn is concerned and is a world leader in the export of cotton yarn.
FEDERAL GOVERNMENT'S TARGETS REGARDING COTTON CROP: (2007 — 08)
Area under cotton cultivation :
8.031 million acres
6.326 million acres
1.581 million acres
Balochistan - N.W.F.P. to be shared by
PRESENT CROP POSITION
A common observation of some cotton growers, traders and ginners is that recent rains are timely and beneficial to cotton crop and that the crop on river bed area is quite safe and healthy. The weather till today is considered cotton friendly and a bumper cotton crop of 14.5 ñ 15 million bales is expected during 2007-08.
IMPORT AND PRICE POSITION OF COTTON
There is no trend or tendency to import lint during July to September, 2007 due to high prices of the commodity in international market, however, the country imported 2.3 million bales from the United States of America, India, Brazil and Central Asian States during January to June, 2007. U.S.A. is offering its lint at around 66 to 68 cents per pound and the same rates are being offered by other cotton exporting states. Lint importers are looking for lint in the prices ranging between 56 to 61 cents per pound, keeping in view the prices that may prove feasible for the spinners and weavers. Reportedly, Pakistani cotton is available to the international and domestic buyers with a difference of 10 cents per pound to the international price of the commodity. The domestic price of lint might go up around Rs.100 to Rs.200 per maund due to the growing demand of textile sector, especially the spinning sector in the coming months. Pakistani lint is in high demand because of the stable supply of lint and growing interests of buyers including private sector and commercial exporters. Due to higher prices in the international market, importers are shying to sign new agreements, however, the arrivals against previous agreements are in progress. It has also been observed that millers and spinners are interested in local lint and they are going to buy any local lint of all qualities even at slightly higher prices. The Ministry has not yet announced support price of cotton for the new season, which is anxiously awaited by the growers. In Punjab seed-cotton prices have reportedly touched the level of Rs.1700 per 40 kg and lint at Rs.3500 per 37.324 kg ex-gin. Official spot rates remained at the previous level of Rs.3,000 per maund, however, business went on well above that rate. There is a guesswork that as industry's demand had gone up reasonably to 16 million bales, it may not be easy to contain an imminent price escalation. The cotton consumption in the country during the last decade registered a growth rate of about 4 percent. In years to come, the domestic consumption is estimated to rise to 18.5 million bales.
FEARS AND APPREHENSION — A WORD TO GROWERS
The country's general elections are fast approaching. Elections campaigns would soon start full-fledged, in which our peasants and farmers would also participate, with their physical, financial and time involvements. Thus there is a well founded fear that they would not be able to give constant care to their cotton crop, which otherwise demands a regular vigilance to protect it from vagaries of the weather, pests and ensure timely picking and marketing of cotton. Besides, the Holy month of Ramzan is also going to start in mid September, 2007. Observing fasts and preparation for celebration of Eid-ul-Fitr would also need their involvement. An awareness programme must, therefore, be launched by the government through print and electronic media to guide the farmers to ensure full and undivided attention to the crop to get the maximum yield and gains.