KARACHI: Unprecedented fluctuation was observed in the local market under the influence of New York Cotton where the fluctuation of 5-6 American cents per pound was witnessed. During the whole week the fluctuations of Rs 500 to Rs 600 per maund was witnessed in the local cotton market.
The spot rate was increased by Rs 500 per maund. The Cotton Crop Assessment Committee revised the target by 9 Lac bales and fixed it at 93 Lac bales. World Cotton Day was observed world wide. The importance of cotton was highlighted. All Pakistan Textile Mills Association has announced to provide 5 Lac jobs by setting up 100 textile mills.
In the local cotton market during the last week after unprecedented fluctuation a mixed trend was seen. In the New York Cotton Market unprecedented fluctuation of 5-6 American cents per pound was witnessed under the influence of which fluctuation of Rs 500 to Rs 600 per maund was witnessed in the local cotton market.
Bullish trend was seen in the Rate of Promise (Waday Ka Bhao) of New York Cotton at the start of the week. On Tuesday the Rate of Promise (Waday Ka Bhao) of New York Cotton reached at the highest level of one dollar fourteen American cents under the influence of which the rate of cotton in local cotton market also witnessed an increasing trend.
The rate of good quality cotton reached at Rs15000 per maund while the rate of Balochi cotton touched Rs 15500 per maund. The rate of cotton reached at the highest level in the history of Pakistan. Textile mills did not show interest in buying cotton on high price while an international firm was involved in massive buying.
The textile mills were cautious due to increase in the rate of cotton because of high parity of cotton yarn. The trading volume remained satisfactory. On Thursday the trading volume increased after the stability in the rate of New York Cotton. However, in the afternoon New York Cotton market started dipping under the influence of which the local market started dipping and by evening the rate of good quality cotton dipped by Rs 400 to Rs 500 per maund. On the other hand due to decrease in the export in the weekly export report of USDA bearish trend started witnessing.
The rate of cotton in Sindh after fluctuation was in between Rs 12000 to Rs 15000 per maund. The rate of Phutti was in between Rs 4800 to Rs 6200 per 40 kg. The rate of Banola was in between Rs 1500 to Rs 1800 per maund.
The rate of cotton in Punjab was in between Rs 14000 to Rs 15000 per maund. The rate of Phutti was in between Rs 5500 to Rs 6400 per 40 kg. The rate of Banola was in between Rs 1600 to Rs 1900 per maund.
The rate of cotton in Balochistan was in between Rs 13800 to Rs 14200 per maund. The rate of Phutti was in between Rs 5800 to Rs 7200 per 40 kg. The rate of Banola was in between Rs 1600 to Rs 2000 per maund.
The Spot Rate Committee of the Karachi Cotton Association increased the spot rate by Rs 500 per maund and closed it at Rs14600 per maund.
Separately, the second meeting of the Cotton Crop Assessment Committee of the Ministry of National Food Security was held on October 7 in Islamabad under the chairmanship of Federal Secretary Food Security Tahir Khurshid. Representatives of the department, Trading Corporation of Pakistan, All Pakistan Textile Mills Association, Pakistan Central Cotton Committee and cotton growers attended it. The purpose of the meeting was to review the overall situation of cotton in the country.
According to the meeting, keeping in view the situation of cotton, the total cotton production in the country for the year 2021-22 has been estimated at 9.74 million bales. Meanwhile, Khyber Pakhtunkhwa and Balochistan are expected to produce 434,000 bales.
Favourable weather conditions and good cotton prices are amongst the reasons for the increase in cotton production
Chairman Karachi Cotton Brokers Forum Naseem Usman said that in international cotton markets especially after fluctuation in the Rate of Promise (Waday Ka Bhao) of New York Cotton overall a bullish trend prevails in the market. The rate of cotton reached at the highest level of 115.92 American cents more over after decreasing it was 110 American cents.
Before that in the cotton season of 2011-12 the rate of cotton had reached at the highest level of 2.25 American dollars which is highest in the history of New York Cotton as a result of massive buying by China. In this way the rate of cotton crossed one American dollar after 11 years.
On Thursday weekly USDA export report shows a decline of 57% in exports as compared to last week. This week China was the biggest importer with one Lac seventeen four thousand bales; although, there were long holidays in China from October 1 due to festival. It is possible that exports may decrease in the next report because of low buying by China. Bullish trend prevails in international cotton producing countries under the influence of unprecedented increase in the rate of cotton in New York Cotton Market. Bullish trend was witnessed in China, India, Central Asian States, Africa, Argentina and Brazil.
Adviser to Prime Minister on Commerce and Investment Abdul Razak Dawood on Thursday announced that investment worth $5 billion is in the pipeline for the establishment of new textile units.
Highlighting the positive outcome of the "Make-in-Pakistan" policy, Dawood wrote on Twitter: "Our Make-in-Pakistan policy is beginning to show results."
"We have been informed that an investment of approximately $5 billion is in the pipeline under which 100 new textile units are expected to be established."
Sharing further details regarding the investment, he said: "Apart from enhancing export capacity, these mills are likely to create about 500,000 jobs."
"This government has reversed the de-industrialisation and InshaAllah, we are now on a path of industrial growth in Pakistan," the PM's aide added.
In August 2020, Prime Minister Imran Khan announced that the government was pursuing a "Make-in-Pakistan" policy in order to promote export-oriented industrialisation in the country.
Under the policy, the government had eliminated or reduced duties on hundreds of tariff lines involving raw material for the local industry to make domestic products competitive.
Earlier, while addressing an online meeting at Central Cotton Research Institute Multan Federal Minister for National Food Security and Research Syed Fakhar Imam said that prosperity of farmers is the top priority of the government. The government is working on a plan to provide relief to the farmers, as well as, on a plan make cotton a profitable crop. The government is also working to bring betterment in seed sector.
However, Karachi Cotton Association organised a seminar on World Cotton Day at its office on I I Chundrigar Road. The purpose of organizing this seminar was to high light the challenges faced by cotton economies of the world. Cotton is very important for less developed countries of the world.
The seminar was addressed by famous speakers related to different sectors of cotton trade. It was addressed by representatives of APTMA, KCA and brokers which includes Asif Inam, Atif Dada, Naseem Usman, Chandar Laal, Khawaja M. Zubair and Jahangir Mughal, who discussed in detail the challenges faced by the cotton industry.
Copyright Business Recorder, 2021
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