KARACHI: Stability in the rates of cotton was seen previous week. Trading volumes; however, continued to be very low. There was increase in the rate of New York Cotton. Finance Minister Ishaq Dar has directed the concerned authorities to solve the problems of the textile sector on priority basis in order resolve the long-standing grievances of the textile sector.
All Pakistan Textile Mills Association (APTMA) is planning to start a pilot project for Research and Development in developing active cotton seeds and increasing the production of cotton. Cotton sowing is in full swing. The position of cotton crop is satisfactory. Relevant institutions are actively working.
In the local cotton market, the price of cotton remained stable during the last week, but the business volume remained very low, as the textile mills continuously faced a severe crisis.
The leaders of the textile sector are complaining about ‘step-motherly treatment’. They are also complaining of not being heard by the government.
There is uncertainty in the local textile sector after the government has taken back the incentives given to the textile sector which includes gas and electricity on concessional rates, issue of sales tax refunds, abnormal increase in interest rates. The deepening financial crisis and recession in USA and European markets are also adversely affecting the textile sector. In this way, the textile sector is in severe crisis which effects cotton market also.
This year the production of cotton in the country is less by 50 lac bales as compared to previous years, yet till the arrival of the new season, the farmers have stock of more than one lac and fifty thousand bales. Some textile mills are finalising deals of one hundred or two hundred bales on credit basis.
The new season is going to start and in fact arrival of new cotton crop has partially started. According to the information received, cotton sowing is satisfactory. Experts believe that if the weather conditions remained favourable, the production of cotton is expected to exceed one crore bales, although the official target has been set at one crore, twenty seven lac and seventy thousand bales. Concerned government agencies are actively working to increase cotton production.
The rate of cotton in Sindh was in between Rs 18,000 to Rs 20,500 per maund. The rate of Phutti which is available in limited quantity was in between Rs 6,700 to Rs 8,000 per 40 kg. The rate of cotton in Punjab was in between Rs 19,000 to Rs 21,000 per maund. The rate of Khal, Banola and oil; however, remained stable.
The Spot Rate Committee of the Karachi Cotton Association kept the rate of cotton unchanged at Rs 20,000 per maund.
Chairman Karachi Cotton Brokers Forum Naseem Usman said that a bullish trend prevails in the rate of Future Trading of New York Cotton while the market remained bearish in India.
According to USDA’s weekly export and sales report, one lac and thirty two thousand bales were purchased for the year 2022-23.
China was at the top by buying 62,000 t bales. Vietnam bought 24,000 bales and came second. Pakistan bought 18,900 bales and came third. Twenty eight thousand and one hundred bales were purchased for the year 2023-24. Bangladesh topped the market by purchasing 12,000 bales. South Korea was second with 6,600 bales. Turkey bought 4,400 bales and came third.
Federal Minister for Finance and Revenue Senator Mohammad Ishaq Dar held a meeting with a delegation of All Pakistan Textile Mills Association (APTMA) headed by its Patron-in-Chief Dr. Gohar Ejaz at Finance Division. Chairman APTMA Asif Inam, SAPM on Finance Tariq Bajwa, SAPM on Revenue Tariq Pasha, Punjab Minister for Energy Syed M Tanveer, Secretary Finance, Secretary Power, Secretary Petroleum, Chairman FBR, and other representatives from APTMA and officials from Finance Division attended the meeting. Gohar appreciated the government on supporting the textile sector by fixing the cotton minimum price.
He briefed the Finance Minister on the vital contribution of textile sector in economic growth and development of the country through revenue generation, creation of employment opportunities, and enhancement of exports of Pakistan. He further apprised the Finance Minister about the issues being faced by textile industry regarding supply chain, regulatory issues regarding imports and exports, and energy related issues as well as supply for various plants across the Punjab province.
The delegation also discussed about the existing disparities among the provinces regarding energy prices and supply and sought support of the Minister in this regard.
Finance Minister Dar acknowledged and appreciated the contribution of Textile sector in economic well being of the country. He committed to provide maximum facilitation of the government to the textile sector in order to strengthen the export sector and enhance the export-led growth of Pakistan.
Additionally, the Finance Minister also directed the concerned authorities to address these issues on priority basis. The APTMA delegation thanked the Finance Minister for extending support to resolve their issues timely.
Copyright Business Recorder, 2023
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