The current cotton season 2003-04 has almost come to an end with the ex-gin production of about 10 million local bales.
Preparation for sowing of next cotton crop (2004-05) is already in progress and some tail-end areas of Lower Sindh have almost completed their sowing operation. Other districts of Sindh province like Hyderabad, Sanghar, Nawabshah and Naushero Feroze are in the process of sowing.
A recent report from Sindh Agriculture Extension Department indicated that against the target of 45,000 hectares, cotton has been sown on 55,000 hectares in Mirpur Khas district of Sindh and in Sanghar district 104,000 hectares against 102,000 hectares.
The same report said that Sanghar has a potential of cotton sowing on 130,000 hectares.
This shows that in the next season cotton would be sown on larger area than current season thus increasing the prospects of a bumper crop.
The provincial governments and their agencies should make sure that sowing operation is completed satisfactorily in all cotton belt districts.
The sowing operation will be extending to other cotton districts of Sindh and Punjab as the time passes.
However, national target of 3.1 million hectares (in 2003-04 area sown was 2.94 million hectares) should be achieved to produce a cotton crop of 11.5 million local bales on the basis of yield of 630 kg/hectare.
Let us hope that weather remains conducive to cotton growing and development. The hard fact is that our seasonal cotton production is stagnated around 10 million local bales while our domestic consumption is around 12.0 to 12.5 million bales, and the shortfall is met through import of some 1.5 to 2.0 million local bales.
Quality-wise, Pakistan has not made any progress in the last decade. We have to be very serious in implementation of Cotton Standardisation/Grading System to improve the quality of our lint cotton to international level.
Despite these facts, government agencies often make tall claims of improving quality and production of cotton.
Recently, the Prime Minister announced to create Textile Ministries in Centre and Punjab province. It is a good news for cotton and textile sectors as it was an old demand of this sector.
When Punjab will have a Textile Ministry then, naturally, Sindh would also have the same, as both are important provinces in cotton and textiles.
Local cotton prices remained under selling pressure during last week and spot rate was reduced by Rs 75, to Rs 2,800 per mound of 37.324 kg ex-gin.
Practically, Grade 3 staple 1-1/32 prime micronaire cotton was selling around Rs 2,600 per mound instead of 2,750 ex-gin.
As such, Spot Rate was higher by Rs 150 per mound than market rates. If Spot Rate is adjusted accordingly, the pledged stocks of cotton would fall short of the advances and the banks would be in a difficult position.
In view of large unsold stocks of low grade/mike cotton its prices remained under selling price which pushed the prices down to Rs 1950 to Rs2000 per mound.
However, better grade cotton was quoted around Rs 2,600 - 2,800 and average grade cotton around Rs 2,400 - 2,500 per mound.
Some of the low grade cotton lots were picked up by exporters which found way in Far Eastern countries at comparatively better price.
Spinners were selective in buying. The ginners were quite upset on low cotton prices. Only by the end of the last week, some buying interests were seen on recovery of New York cotton futures last week.
Reports of some improvement in yarn market, specially in lower count yarns, was received which had positive impact on local cotton prices.
New York futures market witnessed wide fluctuation. On two occasions, prices touched limits one lower and the other high.
May contract went high by 460 points and went down by 434 points while July contract went up by 322 points and down by 450 points.
Net result was May contract up 28 points and July contract down 128 points. May contract closed at 61.99 cents and July contract at 62.36 cents per pound.
US made export sales of 1,86,000 running bales for the week ended April 8. Total sales were reported at 12.491 million 480-lb bales including 449,000 bales of US Pima, while 8.467 bales were reported shipped, including 400,000 bales of US Pima cotton.
PROMINENT BUYERS WERE: (Figures are in million 480-lb bales) China 4.715, Mexico 1.664, Turkey 1.205, Indonesia 0.796, Korea Repub. 0.468, Canada 0.413, Pakistan 0.396 (including 83,600 bales of US Pima cotton), Thailand 0.386, Japan 0.355, Brazil 0.301, India 0.191 and Bangladesh 0.150.
US retail sales position was reported to have improved and was still improving. This would have a very positive effect on cotton and textile trade globally.
Press reports indicate that prices of polyester fibre are increasing in view of increase in prices of petroleum products in the international market. Polyester prices are rising in China also.
Reports from China indicate decrease in local lint prices due to slack spot sales and pressure of large arrivals of imported cotton. China is reported to have withdrawn the quality inspection system of imported cotton which has impacted positively on world cotton prices.
On April 16, in Cotton Exchange, Beijing, May contract closed at yuan 17,700 per ton (96.72 cents/pound), June yuan 17,820/ton 97.38 cents) and July at Yuan 17,840/per ton (97.49 cents). Cotton imports in China are subject to taxes around 14 percent.
Below is a table which gives comparative study of commodity exports of some important Asian countries. Its study and analysis would be of some interest for the readers. Among the 13 countries, Japanese exports have registered the lowest increase of 22 percent in 10 years (1992-2002) while Pakistan is second lowest from US $7.351 billion in 1992 to $9.9 billion in 2002 with an increase of 38 percent.
Japan's economy being very large was suffering from slackness / stagnation. Pakistan's performance in exports is very poor. Even Bangladesh has made good increase of 190.48 percent (From $2.1 billion to $6.1 billion) in their exports in ten years period.
Vietnam ranks first with 534.61 percent increase from $2.6 billion to $16.5 billion.
China the biggest economy in Asia made robust increase in its commodity exports at 283.51 percent from $84.9 billion to $325.6 billion in 2002 and at 415.90 percent to $438.0 billion in 2003.
India has made very good progress in exports from $19.6 billion in 1992 to $49.2 billion in 2002, improving by 151.02 percent.
Apart from this, many countries also export commercial services in billions, such as China $39.38 billion, Hong Kong $45.16 billion, Japan $64.91 billions, Singapore $26.94 billion, Malaysia $14.75 billion, India $23.52 billion and Pakistan only $1.32 billion (almost same in 10 years).
If we compare our export performance with other countries of this area we cut a sorry figure. Perhaps the instability in our political system contributes much to our poor performance of our economy beside other factors. Faults of a few makes all to suffer. We should think seriously and make positive changes in our thinking and performance with the regard to our.
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COMMODITY EXPORTS OF SOME ASIAN COUNTRIES
FIGURES IN US $ IN BILLIONS
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Country 1992 2002 Increase percentage
Middle East 133.3 244.3 83.27
Asia 980.8 1,803.1 83.84
India 19.5 49.2 151.02
Bangladesh 2.1 6.1 190.48
Japan 339.9 416.7 22.60
Indonesia 33.9 57.1 68.44
Korea Rep 76.6 162.5 112.14
China 84.9 325.6 283.51
In 2003 - 438 blns
- 415.9 percent
Hong Kong 119.6 201.1 68.14
Malaysia 40.8 93.3 128.67
In 2003 - 100 blns
-145.09 percent
Pakistan 7.4 9.9 34.00
In 2003 - 10.2 blns
-38.75 percent
Philippines 9.7 36.3 274.22
Singapore 63.5 125.2 97.16
Thailand 32.5 68.8 111.69
Vietnam 2.6 16.5 534.61
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