LAHORE: The local cotton market on Friday remained dull while the trading volume remained very low. The Spot Rate remained unchanged. Cotton Analyst Nasseem Usman while talking to Business Recorder said that price of Punjab’s Phutti attracted per 40 kilograms prices from Rs 7000 to Rs 9000. Cotton of Sindh was traded from Rs 18000 to Rs 20,000 per maund, Punjab’s cotton was traded from Rs 18000 to Rs 20,000 per maund.
The country’s textile exports jumped 37 percent to hit the highest ever level of $1.69 billion in February on the back of orders captured from competing economies during the Covid peak, official data showed on Thursday.
Complete lockdown in India and Bangladesh pushed international buyers to seek Pakistani exporters. “Pakistan opted for smart lockdown, instead of going for complete lockdowns, which aided industries in continuing their fight against the pandemic,” a leading textile exporter said.
According to the latest figures of All Pakistan Textile Mills Association (APTMA) and Pakistan Bureau of Statistics (PBS) compiled by Arif Habib Limited (AHL), exports of textile goods jumped to $1.69 billion compared to $1.23 billion in the same month last year, registering massive growth of almost 37 percent. The export figures of textile sector were also up nine percent compared to the preceding month of January this fiscal.
During the first eight months of financial year 2021-22, export of textile goods surged to $12.62 billion against $10 billion in the corresponding months of last financial year, posting 26.2 percent growth. Pakistan’s textile exports have been on a growth trajectory in the last several months despite gas shortage and expensive power, which textile exporters lived with to realise the full potential of the textile sector.
“Pakistan is still benefiting from the export orders it captured in the peak times of Covid in the world, when its competitors went under complete lockdown and Pakistan managed to keep its industrial sector open by opting for the smart lockdown policy,” Javed Bilwani, chairman, Pakistan Apparel Forum said.
He pointed out that though the figures were impressive, the numbers would have been even higher if the country did not have to face gas shortage during winter.
About future prospects, Bilwani feared that export of textile goods might get hurt because of gas shortage, with severity increasing as RLNG prices rise in the world.
Referring to Russia-Ukraine conflict, the chairman said it raised some serious concerns about the movement of gas prices in the international market, especially once European nations begin purchasing gas from the global market following supply disruptions from Russia. “A country like Pakistan would be in a vulnerable situation, as expensive RLNG is not affordable for us,” he noted.
Textile exporters have welcomed the industrial package focused on industrialization, foreign exchange inflows and revival of sick industrial units. The new industrial plan has set in place pro-growth measures to steam up the industrialization, gear up the exports and put country’s economy on growth track.
Appreciating the government’s initiative, Pakistan Textile Exporters Association (PTEA) chairman Sohail Pasha termed the industrial package as a right move that will lead to the industrial revolution and boost economic productivity in the country. The protection of the stakes of the industrial sector and a good pace of economic progress is a must to tackle the ongoing challenges, he added.
This package would translate into a growth-led revenue generation to overcome the revenue and current account deficit and also revive the idle capacity, he hoped. He briefed that a sizable textile capacity was converted into non-functional or sick units on account of worse business conditions during the last decade and in absence of any mechanism for rehabilitation, textile industry is unable to produce according to installed capacity.
Now, with this package, the activation of idle capacities in the value-added textile sector has become possible which will significantly help in fetching extra 1.5-billion-dollar precious forex and generate more 100,000 employment opportunities.
Executive Member Federation of Pakistan Chambers of Commerce and Industry( FPCCI)and Pakistan Cotton Ginners Association (PCGA)Malik Talat Suhail while appreciating the third Tax Amnesty Scheme and Industrial Incentive Package 2022 by the Government, said that the hard work of FPCCI leadership has paid off. And finally the government announced an incentive package for the development of industry in the country which is need of the time. Industrial development in the country will increase.
He said the government’s development package for the real estate sector was not going to yield the significant results that would now come from the Industrial Promotion Package 2022 and the five per cent tax amnesty for industry and would increase employment.
Malik Sohail said that under the package, rehabilitation of sick industrial units would be practically possible and sick industry would be able to play its role in the development of the country by reviving it.
It is a realistic decision for new industries to start production by June 30, 2024, and foreign Pakistanis will have to make useful of the package.
Under the present package, the textile sector in Pakistan will be further enhanced, for which the announced Cotton authority needs to be put into practice to increase the production of raw cotton resources and especially textile raw materials, ie cotton. Real industrial development is only possible by increasing the production of raw materials.
Malik Sohail said that FPCCI would continue to play its nationally responsible role under the leadership of Mian Anjum Nisar and was constantly striving for the promotion of trade and industry in the country.
ICE cotton futures rose more than 1% on Thursday after a federal weekly exports sales report highlighted strong buying activity for the natural fiber, although a stronger dollar kept gains in check.
The most active May cotton contract on ICE futures rose 1.14 cent, or 1%, to 119.68 cents per lb, at 10:42 a.m. ET. Prices traded within a range of 118.55 and 120.89 cents a lb.
“We had strong export sales report today and that is helping cotton prices,” said Keith Brown, principal at Keith Brown and Co in Georgia.
“However, the Ukrainian war is disrupting everything, oil and stocks are now down. Dollar is also making highs. All these factors are weighing on cotton,” added Brown.
The US Department of Agriculture’s weekly export sales report showed net sales of 348,600 running bales of cotton for 2021/2022, up 41% from the previous week and 51% from the prior 4-week average.
Meanwhile, the dollar index rose 0.4% against its rivals, making the natural fiber more expensive for other currency holders. The Spot Rate remained unchanged at Rs 20,000 per maund. Polyester Fiber was available at Rs 268 per kg.
Copyright Business Recorder, 2022
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