The mealy bug has caused some damage to cotton in Sindh, more in Lower than Upper Sindh, especially in Sanghar district, which produces some 800,000 to 900,000 bales. Inside story says that spray of expired and adulterated pesticides was responsible for wider spread and speedy growth of the pest.
Those who used more of such medicine to eradicate the mealy bug suffered more damage than those who did not use any. When this analyst visited mealy bug affected cotton fields in Sanghar district of Lower Sindh, some fields were found exceptionally very good in respect of production.
However, this loss may be compensated by very good and larger crop along the cotton areas bordering India, and on coastal areas. Last year, this area compensated the damage to cotton in Sanghar district due to heavy rains.
In Upper Sindh, reduction in cotton area was seen in Ghotki district where sugarcane gained the cotton area. Field reports from Punjab speak of a good crop despite minor damage due to pest attack in some areas. Trade circles estimate cotton crop around 14.0 million local weight bales.
In Lower Sindh, cotton harvesting was suspended intermittently due to rains, and seed-cotton (phutti) supply fell short of demand of the ginning factories. This situation was exploited, and prices shot up to Rs 3,500 per maund of lint cotton and Rs 1,600 per 40 kg of seed-cotton. At these unduly high prices both ginners and spinners made losses.
The crop was late due to rains. So, arrivals were slow, but as the ginners started their ginning operation in new crop, this increased seed-cotton prices to negative zone. Resultantly, the ginners forced the spinners, or exporters, to pay higher price. In this game, both ginners and spinners lost money and some of the ginners in lower Sindh closed down their factories.
Despite all odds, seed-cotton arrivals were higher than last year. Hopefully, after Eid holidays, seed-cotton arrivals both in Sindh and Punjab would increase considerably. The problem of high micronaire, beyond 4.9, is still there--more in lower than in Upper Sindh. Local spinners are not minding it, but in exports it is undesirable and may attract claims.
In Punjab, micronaire values are within tenderable limits but grade and staple problems have been reported. However, next arrivals of seed-cotton would be better quality-wise, it is hoped.
The problem of high micronaire values in Bt cotton is there in Pakistan but in India it is rare. Apparently, it is because India uses original first-generation seed, but in Pakistan Bt seed of second, third and fourth generations is used, which is smuggled from India. We do not have our own Bt seed, and work on smuggled seed which, after first generation, starts deterioration in fields yield, ginning out-turn and fibre properties, especially micronaire values.
If Pakistan does not evolve its own Bt seed and continues using Indian smuggled seed, our lint cotton quality would be adversely affected, both qualitatively and quantitatively, ultimately deteriorating the quality of our yarn and cloth.
Lint cotton prices have been fluctuating frequently in the past fortnight, mainly on supply & demand situation. But now prices are getting settled close to realistic levels. Last week, lint prices remained under pressure, and lost about Rs100 per to settle around Rs 2,800 level, with minor plus/minus.
The exporters are understood to have committed some 80,000 bales for export and are now covering their position for making shipments. One new Hong Kong/Singapore based company is reported to have purchased sizeable quantity of cotton through their local office, while one old prominent foreign company procured a couple of thousand bales locally for export.
International merchants consider the present level of Pakistan cotton as workable and competitive against other growths. Bangladesh and Indonesia are regular and prominent buyers of Pakistan cotton.
The exporters consider the present level of prices as high and want to see these at the level of Rs 2,500/2,600 per maund (of 37.324 kg) ex-gin.
Market experts indicate some downward pressure on prices in the next fortnight, or so, but it may be short-lived. Pakistan's total annual lint cotton requirements may be around 15.5 to 16.0 million bales this season and so it would have to import some 2 million equivalent of local weight bales to meet the shortfall.
At present, the profitability condition of our spinning mills is not good, and some of the mills have shut down while others have curtailed production, thus reducing cotton consumption accordingly. The performance of our textile exports to US and European destinations were reportedly weak during the last month.
In the international market, cotton prices remained quite high and New York future prices touched the level of 68 cents/lb twice and this strength was a reflection of higher prices of grains and soybeans. Now, the prices are decreasing, and so the cotton prices.
India is expecting a bumper crop of 32 to 33 million 170-kg bales, and may have a surplus of some 7-8 million bales for export. As Indian cotton starts moving into local market, the prices may ease, making it more attractive in export.
According to final production figures of 2006-07 season, India surpassed USA by a small margin to occupy the position of second largest cotton producing country, while this season, India is consolidating its second position with even larger margin of some 7.0 million 480-lb bales. Cotton circles foresee India to become the top-most cotton producing country in the world in the next five years and also one of the top-most exporter of textile goods. India with the tremendous increase in cotton productivity and production, it has also improved its quality of cotton to international levels. Pakistan has to do a lot to maintain its position in cotton world.
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