The Pakistan Cotton Ginners' Association (PCGA) released final cotton statistics for 2003-04 season on June 3, according to which, total season's national ginned cotton has been placed at 9,784,526 local bales.
Of the total, Punjab produced 7,664,973 bales (78.33 percent); Sindh 2,125,957 (21.63 percent); and Balochistan 3,596 bales (0.04 percent).
The confusing factor is that Balochistan Agriculture Department claimed seed-cotton production equivalent to some 100,000 bales this season, then why only 3,596 bales were ginned by three factories in Balochistan which have ginning capacity of about 50,000 bales?
The same phenomena was seen in last two seasons. Neither the Minfal nor the Provincial Agriculture Department bothered to find out the reasons for this anomaly. Of course, Balochistan must be producing many times more than its ginned production, but why the local ginneries avoided receiving local seed-cotton and allowed it to be transported to the ginneries either of Sindh or Punjab, with added cost of transportation?
Or, is it a scheme to deprive the growers and workers of Balochistan of the real benefits of cotton growing and ginning?
The local cotton growers would want to know the real reasons.
The same PCGA report mentioned 653,136 bales as unsold with the ginners. This figure of unsold stock appears quite high against the trade estimate of about 500,000 to 550,000 bales and it would have negative effect on cotton prices.
However, the chapter of cotton statistics for 2003-04 season is now closed.
New crop sowing operations in Upper Sindh and Punjab are progressing well whereas in Lower Sindh it has almost been completed.
Cotton plants in Lower Sindh are growing in conducive weather conditions. Although the arrivals of seed-cotton are expected in mid-July but, taking benefit of doubt of possible delay, a prominent ginner of Sultanabad (Mirpur Khas) has committed a maiden sale of new crop cotton at Rs 2,800 per maund ex-gin for delivery in the third week of August.
This new crop sale will also have a bearish effect on local cotton prices.
KCA spot rate was reduced by Rs 25 to Rs 3,075 per maund at the close of last week. The local cotton market has shown signs of weakness and the price quotations have been lowered by Rs 50 to Rs 75 per maund.
According to reports, National Commodity Exchange, Karachi, is going to start Futures Trading in gold and yarn, probably from July 1, 2004.
Generally, futures trading is operated in basic raw materials such as agriculture produce, like cotton, grains, and edible oils, and minerals like gold, copper and tin as prices of these commodities face wide fluctuations.
Now, the government should also restore futures trading in cotton, under Karachi Cotton Association ( KCA ), as with the permission of operating futures market in gold and yarn all hurdles in the way of restoration of Cotton Hedge Market have been removed.
The KCA has all the necessary infrastructure facilities such as a building housing cotton merchants and brokers, operational facilities, experienced people, updated bye-laws and status/recognition nationally and internationally.
China has also introduced futures trading in cotton from June 1, 2004, under Zhengzhou Commodity Exchange.
In India, Future Trading is already going on in Mumbai Cotton Exchange under East India Cotton Association, Mumbai.
The cotton marketing conditions in India and China are quite similar and there appear cogent grounds for restoration of Future Trading in cotton under KCA from the next cotton season.
This would provide equal opportunity to all cotton stakeholders to save their interests from undue fluctuation in prices due to national and international factors.
Our spinners have already started operating in New York Future Market through Hedge Trading to ensure risk-free availability of raw cotton.
As a matter of fact, if futures trading in cotton is restored in Pakistan, there may not be much necessity for any future trading in yarn because once fluctuation risk in cotton is covered then fluctuations in yarn prices would already be covered.
Recently, local spinners were reported to have made bookings of foreign cotton, specially of US and Brazil origin, to about 300,000 bales mostly with Fixed Bases and Open Fixations.
Trade circles estimate total receipts of cotton shipments at around 1.5 million local bales and, by the close of this marketing year (2003-04), total shipments may touch the level of 2.0 million bales, and in next season, our import requirements may be even higher.
As a matter of fact, all ground realities regarding inputs, human efforts and irrigation facilities have not improved from previous years; so we can only harvest a crop around 10.0 million bales.
The only factor affecting the size of our cotton crop would be mother Nature which may boost our production next season.
New York cotton futures were under selling pressure last week. The retiring July contract lost 339 C/Pts, October 185 C.Pts and December 151 C/Pts to finally settle at 57.80, 57.75 and 57.51cents, respectively, per pound--almost all in line.
Main international factors affecting cotton market adversely were very high oil prices, political unrest in Middle-East, slowdown in Chinese economy, and prospects for a larger world crop (around Plus 102 million 480-lb bales).
USA made export commitments of 149.400 running bales in the week ended on May 27. Main buyers were Pakistan 32,800 bales, Turkey 31,900 bales, Taiwan 16,500, Thailand 14,900, India 13,900, and South Korea 10,500 bales. Up to date export sales of USA are:

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              Upland    Pima    Total
-------------------------------------
Export Sales  12.860   0.505   13.365
Shipments     10.109   0.448  10.557m
                             48-Bales
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Main buyers include (Upland and Pima both) China 4.901 million 480-lb bales, Mexico 1.735 million, Turkey 1.341 million, Indonesia 0.852 million, Korea Rep 0.498 million, Pakistan 0.453 million, Thailand 0.453 million, Canada 0.413 million, Japan 0.373 million, Taiwan 0.346 million, Brazil 0.305 million, India 0.219 million, and Bangladesh 0.192 million bales.
USA has also made Export Sale commitments of 1.619 million bales of 2004-05 crop, with Pakistan' share of 36,800 bales.

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Level of Weaving Technology (percentage of Shuttle-less looms):
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USA         91%  Russia   78%  Taiwan      46%  Korea Rep   27%
Indonesia   11%  China   9.7%  Pakistan   5.8%  India      1.1%
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China's cotton planting in 2004-05 season may be higher by 9 percent from last year, to harvest a bumper crop of 6.0 million tons (=27.5 million 480-lb bales) achieving yield around 1270 kg/hectare.
China's total domestic cotton consumption is projected around 8.0 million tons (Mill consumption 7.6 and miscellaneous 0.4) (=36.73 million 480-lb bales). This means that China may import about 2.0 million tons cotton to meet its domestic shortfall.
In 1984, China produced record high crop of 6.25 million tons (= 28.7 million bales) and trade circles think if weather is found conducive, China's next cotton crop may even break this record.
On June 4, China Cotton A-Index was 85.51 cents and B-Index at 76.41 cents. China's per capita fibre consumption is 6.6 kg, against world average 7.5 kg. Increase in polyester consumption is estimated around 7.4 percent and China expects increase in polyester consumption around 6.5 percent each year in next 5-10 years.
India appears quite ambitious in projecting its next crop in 2004-05 season at 19.0 million 170-kg bales, against 16.75 million bales in 2003-04 season.
India has already introduced 'Genetically Modified' (GM) technology some two years back in its three important states of Gujarat, Maharshtra Pradesh and Andhra Pradesh, and its growers now feel encouraged in sowing Bt cottonseed widely in view of better return.
Cotton growers of Northern Region comprising states of Punjab, Haryana and Rajasthan appear quite crazy for sowing Bt cottonseed although no Bt cotton variety has so far been approved for sowing in these areas.
However, Bt cottonseed is being sown illegally in these areas. Publicity of Mahyco Monsanto Biotech Company has lured cotton growers for sowing Br cottonseed, saying that through it attack of boll worm is reduced by 58 percent, yield is increased by 24 percent and production profit is increased by Rs 7,276 per acre, a report from India says.
Here is the position of shuttle-less looms in some important countries:
China 94,132; USA 54,646; Korea Rep. 29794; Indonesia 28,064; Taiwan 24,244; India 20,487; and Pakistan 15,709. As regards operation of Ready Made Garments through manual action or power, here is a report:

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Countries    Manually    By Power
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India         31.00 %     69.00 %
China          0.10 %     99.90 %
Korea          2.40 %     97.60 %
Taiwan         0.01 %     99.99 %
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Cotton Statistics of some important countries
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Countries         Area         Production          Yield
              (m hectares)      (m bales)   (kg/hectare)
              2002    2003    2002    2003   2002   2003
--------------------------------------------------------
China         4.82    4.30   24.38   20.89   1089   1058
USA           5.59    5.26   20.06   18.32    708    758
India         8.74    7.39   11.80   10.93    292    322
Pakistan      3.13    2.83    7.80    7.90    610    615
Others       11.70   10.83   32.78   30.03    610    609
World total  33.98   30.61   96.84   88.16    621    627
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