Field reports indicate that Sindh province has achieved 80 to 85 percent of its sowing target while Punjab province has done 70 to 75 percent cotton sowing.
Weather conditions are reported quite conducive for cotton planting and concerned circles hope that Pakistan's national sowing target of 3.25 million hectares would not only be achieved but would be surpassed marginally.
More important element in cotton productivity is the behaviour of weather specially the monsoons during crop development. Pakistan produced best crop of 14.5 million bales of 170-Kg in 2004-2005 when the weather played a pivotal role but in subsequent two seasons Pakistan's cotton production could not cross the level of 12.5 million bales while next season official production target is 14.4 million bales. In early sown areas, plants are flourishing well and flowering stage may set by the start of next month and harvesting may literally start by the third week of July but commercially by the end of July or start of next August.
One Ginner of Mirpur Khas area is reported to have sold a couple of hundreds of new crop lint at Rs2,600 maund of 37.324 Kg ex-gin for 15th August delivery. Hopefully, ginning factories in lower Sindh and in some early sowing areas of Central Punjab, would resume operation in new crop in the start of next August.
Since Bt. Cotton varieties have been sown on most of the area in lower Sindh so the quality of early arrivals of cotton would be very good matching with Middling in grade with staple length between 1-3/32 to 1-5/32, strength between 24 - 28 GPT but micronaire values may be on the higher side sometime above maximum level of 4.9 micrograms (Microgram is one millionth of a gram) per inch.
However, in subsequent arrivals micronaire values would come down below 5. In the early arrivals, the element of moisture contents is also found on the higher side even above 10 percent level, which is also reduced in later arrivals. In the early part of the season, local spinners rush to lift each and every lot of cotton to feed their mills and add to their inventory. In these days, price level is kept about Rs100 per maund (= US Cents 2.00/lb ) above export parity to keep the exporter away from the market.
The unsold stocks of cotton from current crop still held by the ginners are now estimated around 250,000 - 300,000 bales, most of which may be below average grade. There are two months left to the start of the new cotton crop arrivals. Lint cotton prices after touching the level of Rs2,800 per maund of 37.324 Kg in last week of April, 06 was expected to touch the level of Rs3,000 but after remaining firm around Rs2,800 for a couple of weeks it showed signs of weakness on low N.York advices and weak yarn prices and shed Rs 150 to 200 to touch the lower level of Rs2,600.
Again on renewed buying interests, local market showed signs of recovery and on the last Saturday (the 26th May,07) fine lots were traded at Rs2,725 / maund ex-gin and some ginners are now expecting the market again touch the level of Rs2,800. If the present firmness in the market extends to the start of the new cotton season then new season lint prices may also keep the level of Rs2,700 and may go down when more factories resume operation and prospects for a bumper cotton crop are found.
This time, the sowing of cotton has not been made in intervals but in one time as there was no shortage of irrigation water like last time. Thus plants are equally progressing and size of plants is more uniform. This process would help the plants attain maturity simultaneously and be prepared for bulk harvesting. The rush of arrivals may be expected and if the prospects of producing a bumper crop of 14.5 - 15.0 million crop brighten up then the expected price level of Rs2,700 in the early season may bulldoze to a lower level and peak of arrivals may prompt government intervention in maintaining the level of minimum support price.
In efforts to improve the quality of our lint cotton, the Textile Ministry of Pakistan is reported to have finalised the site in Multan for erection / installation of a full-fledged Ginning Institute for imparting training to ginning workers, making research on cotton quality and improving quality of ginning.
The same ministry is also working on a plan to implement cotton grading / cotton standardisation system to improve the quality of Pakistan cotton to international standards by utilising the services of private sector specially the Inspection agencies controlling import and export of cotton.
The Pakistan Cotton Standards Institute (PCSI) would operate as monitoring agency. This exercise requires lot of homework before coming into a final shape. Let us hope Pakistan succeeds in its mission of introducing cotton grading / cotton standardisation system to improve its cotton standards to international levels. The exporters would also be able to enter in to the market when the level of export parity would be matching with local market prices.
New York cotton market some time shows signs of strength but it fails to maintain this position. On last Saturday, prices on New York market got impetus and prices jumped by 100 - 125 points and ruling July contract closed at 51.14 and new crop October contract finished at 54.50 cent /lb. US is selling its cotton in export aggressively and has crossed the level of 13.0 million statistical bales, including carry-over of last season with shipments crossing the level of 8.0 million bales. As on 22nd May,07, 3.5 million bales are reported to be under loan. The uncommitted stocks of US cotton are decreasing every week's robust export sales and this gives some indication to firming up of cotton prices in coming weeks.
Top nine US cotton buying countries, including China (3,740 thousand bales), Turkey (2,140 thousand bales), Mexico (1,670), Indonesia (970), Pakistan (606 thousand bales) and other have brought some 11.0 million bales out of 13.0 million bales. Cotton planting in US, China and India is progressing well under comparatively favourable weather conditions. Monsoon which matter much for cotton season is likely to touch India's southern coast next week and then spread to Maharashtra and Gujarat cotton areas. In the next couple of months prospects of cotton production in prominent countries would affect cotton market.
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