KARACHI: Overall a bullish trend prevails in the market. The Spot Rate witnessed an increase of Rs 600 per maund. It is expected that country may face cotton crisis in January. Small textile mills should look for other options. Cotton Crop Institute conducted a training programme regarding eradication of Pink Ball Worm.
The rates of cotton remained stable overall in the local cotton market during the last week because of the cautious buying by the textile and spinning mills as due to the interest of ginners in selling.
Although, ginners had increased the rates of cotton after the report of Pakistan Cotton Ginners Association released on December 15 due to which the trading volume witnessed a downward trend.
The report shows downward trend which is beyond expectation. It is expected that there will be shortage of cotton in the month of January. However, according to the estimates new crop of Phutti will arrive in six months and it will be difficult for both the big and small groups to import cotton from abroad as a result mills will look for another option.
The parity between Pakistan rupee and US dollar is unstable. There is energy crisis and moreover there is a threat of Omicron virus. According to the sources an international organisation had piled a stock of cotton which it is selling on high rates.
Now, there is a question: will the small mills have to look for another option if cotton crisis arises in January. The rate of cotton in Sindh is between Rs 14500 to Rs 18000 per maund. The rate of Phutti which is available in small quantity is in between Rs 5500 to Rs 7200 per 40 kg. The rate of Banola is in between Rs 1450 to Rs 2300 per maund.
The rate of cotton on Punjab is in between Rs 15500 to Rs 177700 per maund. The rate of Phutti is in between Rs 5800 to Rs 7800 per 40 kg. The rate of Banola is in between Rs 1500 to Rs 2400 per maund. Cotton and Phutti were not available in Balochistan anymore.
The Spot Rate Committee of the Karachi Cotton Association has increased the spot rate by Rs 600 per maund and closed it at Rs 17400 per maund. Chairman Karachi Cotton Brokers Forum Naseem Usman told that overall a bullish trend prevails in international cotton market. The rate of New York Cotton after fluctuation increased by 2.50 cent and closed it at 109.40 cent. The trading time was decreased in New York Cotton on Thursday due to Christmas holidays. Overall there will be no trading on Friday, Saturday and Sunday while trading will resume on Monday a little bit late.
According to the USDA export report more than two lac fourth thousand bales were sold which is 15 % low as compared to last week. This time too China was the biggest importer with more than sixty eight thousand bales; Vietnam was on number two with more than thirty two the bales while Turkey was on number third with more than twenty nine thousand bales and Pakistan was on number fourth with more than twenty three thousand bales.
The rates of cotton increased in Brazil, Central Asian States and Africa while bullish trend prevails in India due to buying by the textile spinners.
Finance Minister of Punjab, Hashim Jawan Bakht has assured All Pakistan Textile Mills Association (APTMA) of pursuing the issue of non-supply of gas for exports-oriented units in Punjab with the Federal Government at all appropriate levels while admitting that it has caused a colossal loss and disruption to the textile sector.
The Minister was talking to APTMA delegation led by Abdul Rahim Nasir, Central Chairman, Hamid Zaman, Northern Zone Chairman, Karman Arshad, Senior Vice Chairman, Asad Shafi, Treasurer, Umar Latif and Raza Baqir, Secretary General of the Association.
Rahim Nasir briefed the minister about disconnection of gas supply to all Punjab-based mills despite the fact that the mills have accepted enhancement of gas tariff up to $9/MMBTU till March, 2022. He said non-availability of gas has severally effected production and export of textile products. He also highlighted disparity in gas prices between Punjab and other provinces. He added that upward revision in gas tariff from $6.5/MMBTU to $9/MMBTU has further widened the gulf of price difference.
He pointed out that gas prices in Sindh and KPK were $4.87/MMBTU whereas gas price for industry in Punjab has been raised to $9/MMBTU and gas is not at all available even on the said high tariff. He added that gas price of $4.05/MMBTU in Bangladesh and $5.19/MMBTU in India was also much lower than the tariff applicable to Punjab-based export industry.
He said the Regionally Competitive Energy Tariff (RCET) provided by the current government over the past 3 years has yielded outstanding results. The industry has delivered to the nation by investing Rs450billion in machinery for capacity enhancement as per its commitment. This has resulted in an increase of $500 million in exports each and every month in FY22 so far. He apprehended that the new projected investment of $5 billion, setting up of 100 new plants and addition of at least 500,000 new jobs with 90 percent of them in Punjab would all be jeopardized with this sudden increase in gas tariff.
Chairman APTMA also urged the provincial government to take up the matter of non-availability of gas with the Federal Government to enable export-oriented industry located in Punjab to continue their operations.
Chairman APTMA Northern Zone Zaman apprised the Minister about the problems being faced by exporters due to non supply of gas and sheer mismanagement in the gas distribution priorities. He expressed surprise that gas was not being provided to export industry in total disregard to the fact that country disparately needs to accelerate production to upsurge foreign exchange earnings through enhanced exports.
The Punjab Finance Minister assured APTMA of full support from the Punjab Government to make export industry operate on its full bloom and to make gas available to them to continue their business activities.
Bakht said that Punjab government would leave no stone unturned in supporting smooth functioning and growth of export industry to maintain the momentum of upsurge in exports.
He further said that the government has pinned high hopes on the export-oriented sector for creation of jobs and new investment in the country. He said that the issue regarding disparity on energy prices within the country would also be taken up with the Federal Ministries to provide even level playing field to Punjab-based mills. He committed to frequently interact with the industry and resolved to do the maximum to address issues of the industry.
Kamran Arshad, Senior Vice Chairman APTMA thanked the Minister in particular and the Provincial Government in general for their bold initiatives in resolving the issues faced by the industry and hoped that with the continued support of the Government, the whole textile sector would make all-out efforts to promote further investment in textile sector and upsurge textile exports. He also vowed the commitment of the industry to accelerate economic activities to bring new investment, create more jobs and to foster exports provide energy requirements of the industry are met with uninterrupted supply of gas and electricity at regionally competitive energy tariff (RECT).
The government has reportedly agreed, in principle, to supply gas to those textile units, which cannot operate without gas, well-informed sources told Business Recorder.
The decision was taken at an internal meeting presided over by Advisor to Prime Minister on Finance and Revenue, Shaukat Tarin.
Minister for Energy Hammad Azhar, Minister for Industries and Production Khusro Bakhtiar, and Advisor to the Prime Minister on Commerce and Investment Abdul Razak Dawood also attended the meeting.
The sources said it was decided in the meeting that a list of those textile units be sought from the All Pakistan Textile Mills Association (APTMA), which cannot operate without gas.
The sources said, presently, there are 126 textile units, which are neither being supplied full electricity for operation nor gas for processing.
Insiders claim that the gas companies were supplying gas to about 1,800 units, which does not fall in the category of export-oriented units.
Now, gas to some of them will be curtailed or disconnected to accommodate eligible textile units.
Moreover, a series of training programmes for master trainees from different districts of Punjab to combat Pink bollworm would start on December 14 at Central Cotton Research Institute (CCRI).
The training session would remain continue till end of December. In the first phase, agricultural officers and field assistants from Vehari, Lodhran, Bahawalpur and Rahim Yar Khan districts would participate in the training programme at the institute, said CCRI Multan Director Dr Zahid Mahmood in a statement.
He observed that pink bollworm causes loss of one to two million bales of cotton worth billions of dollars every year.
There is a need to pay close attention to abolish the bollworm to control losses. The CCRI is launching a series of training programmes for workers of the Department of Agriculture Extension, officers of Agriculture Pest Warning and Quality Control and other staff from different districts across the province.
The meeting would be attended by entomologists from all over the country. Practical demonstrations on the removal and control of Pink bollworm would be done in the field in addition to presenting lectures to the participants.
Copyright Business Recorder, 2021
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