KARACHI: The stop rate of cotton reached at the highest level of Rs 22000 per maund. Prime Minster Imran Khan established a Cotton Authority for increasing the production of cotton. Karachi Cotton Association, All Pakistan Textile Mills Association and other related organisations welcomed the decision of the establishment of the Cotton Authority. Employees are protesting against abolishing Pakistan Central Cotton Committee. Approval of new five-year textile policy has been made. There is a request for fixing of new support price of Phutti. Some textile mills have started selling cotton on high rates.
In the local cotton market during the last week textile and spinning sector showed less interest in buying of quality cotton while due to the high rates of cotton, ginners were cautious in selling while the stock of cotton is decreasing. The rate of cotton in international cotton markets remained stable. The trading volume remained low due to high rates.
A few days back an international organisation sold cotton at Rs 20250 per maund and Balochi cotton at historic high of Rs 20700 per maund. The ginners, who had the stock of cotton, were demanding high rates. New season will be started after five months but it is expected that stock of cotton will be over in the month of February. There will be problems for small mills and they will have to look for other options for fulfilling their needs. However, due to increase in the rate of cotton there is an issue of parity between the rate of cotton and cotton yarn. Many big groups had bought cotton on high rates and now they were selling it on higher rates.
It is welcoming that Prime Minster Imran Khan had started taking interest in increasing the production of cotton and in this regard he has given approval for the establishment of a Pakistan Cotton Authority.
Farmers of cotton have gotten good rates and the production of cotton is increasing. It is hoped that in the new season farmers of cotton will take interest in increasing the production of this crop. It is expected that growing area of cotton in Sindh will be increased due to which it is expected that partial arrival of Phutti will be started by the end of May. However, supply of quality seeds and pesticides are important factors which play an important role in increasing the production of cotton.
The rate of cotton in Sindh is in between Rs 18000 to Rs 22000 per maund while Phutti was not available. However, the rate of Banola and Banola Khal is stable. The rate of cotton in Punjab is in between Rs 19000 to Rs 22000 per maund. The rate of Phutti as per quality is Rs 7000 to Rs 8900 per 40 kg. The rate of Banola, Banola Khal and eatable oil remained stable. In Balochistan ginning factories were not operational.
The Spot Rate Committee of the Karachi Cotton Association increased the spot rate by Rs 500 per maund and closed it at Rs 20,200 per maund.
Chairman Karachi Cotton Brokers Forum Naseem Usman told that over all rates of cotton remained stable in international cotton markets. The Rate of Future Trading of New York Cotton after fluctuation reached at 126 American cents per pound. According to weekly USDA sales and export reports more than one lac eighty five thousand bales were sold. China was on number one after buying one lac eight hundred bales; Pakistan was on the second number with more than twenty thousand and six hundred bales while Vietnam was on number third after buying more than fourteen thousand bales.
The rate of cotton in Brazil, Central Asia and Africa remained stable. In India rates of cotton witnessed a significant increase after the production of cotton in India decreased by twelve lac bales as compared to initial estimates and due to increase of demand by ten lac bales. The rate of Shankar 6 quality cotton after increasing reached at Rupees seventy nine thousand and two hundred per candy (356 Kg).
A meeting of the Economic Coordination Committee (ECC) of the Cabinet has approved a revised Textiles and Apparel Policy, (2020-25) after incorporating certain amendments.
The meeting presided over by Minister for Finance Shaukat Tarin was submitted the revised Textiles and Apparel Policy, 2020-25 by the Ministry of Commerce subsequent to incorporating a few changes along with the implementation report. When asked, an official on condition of anonymity said gas supply to the captive power plants has been defined by incorporating changes in the policy.
Principally approving the formation of the Pakistan Cotton Authority (PCA), Prime Minister Imran Khan on Monday called for effective legislation to protect farmers’ rights. PCA’s formation was principally approved to “ensure the provision of quality seed, monitoring and enhancing the yield”.
According to Prime Minister Office, PM Khan presided over a meeting on the agriculture sector and discussed enhancing the cotton yield. He said the government was providing a subsidy on modern agricultural equipment, quality seed and fertiliser. “The benefits of subsidy must be extended to the farmers through the Kissan Card scheme,” the prime minister was quoted as saying.
Regarding fresh legislation, he said it should be made in coordination with all stakeholders to protect farmers’ rights. During the meeting, approval was also given to form an inter-ministerial committee to provide quality cotton seed and approve the promulgation of new laws to protect farmers’ rights. The participants were told that a stock of 4.7 million tonnes of wheat was available in the country and both the federal and provincial governments were providing a subsidy worth Rs15.5 billion. The Prime Minister said that the benefits of subsidy must be extended to farmers
It was told that a farmers’ forum had been created under Federal Food Security Minister Syed Fakhar Imam to ensure the representation of farmers in policymaking and for early resolution of their issues.
The prime minister also approved a proposal to hold a National Cotton Conference and directed the Ministry of Industries to prepare a feasibility report on the establishment of plants for indigenous production of diammonium phosphate, the world’s most widely used phosphorus fertiliser.
On the other hand the employees of Pakistan Central Cotton Committee appealed to the Prime Minister of Pakistan that government should ensure that after the establishment of Pakistan Cotton Authority, the employees of PCCC will not loose their jobs. They also said that the Prime Minister should take notice of a ‘conspiracy’ behind establishing new authority in the presence of PCCC. They also said that Prime minister should investigate that who wants to eat billions of rupees of cotton cess.
Farmer across the country have been asked to submit their estimates of cost of cotton production with Ministry of National Food Security and Research as the government seeks to determine an adequate intervention price for the 2022-23 crop, a report published in a local newspaper claims.
Pakistan’s cotton sowing season starts from mid-March to mid-July in core and non-core areas, while picking starts from October to mid-January. For the cotton crop 2021-22, the government in August 2021 had approved seed-cotton (Phutti) intervention price of Rs5000/ 40kg in a bid to encourage farmers to revive the shrinking crop.
Intervention price is fixed to safeguard the growers and in the event of a drop in price from that level, the state-run TCP (Trading Corporation of Pakistan) will procure it from farmers. This protection from exploitation encourages local farmers to cultivate more cotton.
Federal Minister for National Food Security & Research (NFS&R), Syed Fakhar Imam, while chairing the annual meeting of Agriculture Policy Institute (API) Committee on Seed-Cotton (Phutti) for 2022-23 said, “The government is focusing on revival of cotton, the largest cash crop of the country, through a number of programmes”.
Besides the government officials, representatives of growers’ associations, research scientists, experts, planners, and research departments attended the meeting.
Imam said his ministry would organise the first cotton conference in March. “Prime Minister will inaugurate this important event,” he said adding, “It will bring together key stakeholders at one platform to discuss the issues of the farming community, listen to best practices, and prepare an action plan for the future”.
Tahir Khurshid, Federal Secretary NFS&R, highlighted the importance of the economic gains from the crop, through better price of the produce, which was possible through quality seed, better management practices, and efficient use of inputs.
He asked the farming communities to share their cost of production estimates in order for the ministry to work out intervention price recommendations for the next crop. Empirical evidence indicates that in Pakistan, cotton production increased during intervention years. Cotton area and yield have increased during TCP intervention period (1998-2010) and decreased during the non-intervention period (2011-2020).
According to Pakistan Cotton Ginners Association’s (PCGA) latest fortnightly report, seed-cotton equivalent to over 7.4 million tonnes (or exactly 74,20,917 bales) reached ginning factories across the country till February 1, 2022, registering an increase of 33.19 percent as compared to the same period of last year. Earlier, the representatives of the cotton growers expressed their concerns related to cotton cultivation.
Representing the growers in the meeting, Rabia Sultan from Punjab appreciated the government’s price policy for 2021-22, which was fixed at Rs 5,000/40 kg as intervention price and paved the way for remunerative price received by the cotton growers.
She asked that the Cotton Vision 2015 needed to be revisited and a new long-term strategy should be devised with the participation of growers.
Syed Mumtaz Shah from Sindh shared that the early varieties had proved much better productivity where growers have picked 38-40 mounds of seed cotton. He urged the government to consider up scaling of approved varieties for early sowing, which would bring a huge difference in the overall production.
Copyright Business Recorder, 2022
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