With the final figures of cotton production for the 2005-06 season at 12.376 million bales ex-gin and 13 million bales ex-farm statistically the running cotton season has come to an end.
As compared to the record high production of 14.3 million bales in the 2004-05 season, this season's production fell short by 1,976,000 bales, or 13.76 percent.
For the next (2006-07) cotton season, the Ministry of Food, Agriculture and Livestock (Minfal) has fixed the target of 13.816 million 170-kg bales. Apparently, the target is based on some special calculations, according to which the figures have been worked very precisely to thousands of bales. Usually, production estimates/targets are fixed on broad base units of half a million bales, say as 13.0 million bales, or 13.5 million bales, or 14.0 million bales.
One report says that rains in the 2006-07 cotton season are expected to be on the lower side, which may brighten the chances of better production.
Time will tell the real story, for which we have to wait. Government version is for some increase in the area under the next cotton crop while private sector version is that area under sugarcane would be increased and not area under cotton.
The Minister for Textile Industries had said that the Government had allowed sowing of Bt cotton varieties. The question is: where is the seed? Growers are using Bt cotton seed smuggled from India. The Government should make immediate arrangements for introducing GM (Genetically Modified) technology so as to increase productivity rate, total production and growers' profit. India brought some 1.35 million hectares land under Bt cotton this season.
Indian research/study has shown that Bt cotton seed does not die each year, as was normally considered, but the same Bt seed performs well up to six generations, and there is no need to change the seed every year. India has also started production of 'Organic' cotton in specific areas of southern states, which would give better return to farmers. A comparative study of 'Organic' cotton and 'Bt cotton', conducted recently by the Centre for Sustainable Agriculture (CSA) in India on 120 fields of Bt Cotton and 123 fields of 'Organic cotton', known as NPM (Non-Pesticidal Management) in Andhra Pradesh, has shown some interesting results:
-- Cultivation cost of Bt Cotton was 67 percent higher than NPM cotton.
-- Income from Bt Cotton was 37 percent lower than NPM cotton.
-- Total per acre cultivation cost of Bt cotton was Indian Rs 8,366 (= Pak Rs 11,300) and of NPM cotton Indian Rs 5,008 (Pak Rs 6,760).
-- Cost of pesticide sprays on Bt Cotton was Indian Rs 1,629 (= Pak Rs 2,200) per acre which is 4.8 times more than on NPM cotton.
-- Gross income per acre on Bt Cotton was Indian Rs 11,918 (=Pak Rs 16,100) while on NPM cotton it was Indian Rs 10,627 (=Pak Rs 14,350).
-- Average market price of seed-cotton (phutti) for Bt cotton was Indian Rs 1941 per quintal of 100 kg (= Pak Rs 980 per maund of 37.324 kg), while that of NPM seed-cotton (phutti) was Indian Rs 2,032 per quintal of 100 kg (= Pak Rs 1,025 per maund of 37.324 kg).
-- Net income per acre on Bt Cotton was Indian Rs 3,551 (= Pak Rs 4,800) while on NPM cotton it was Indian Rs7,580) - 36.67 percent higher.
-- Average yield per acre; Bt. Cotton = 614 kg and NPM cotton = 573 kg.
These are the study results which certainly give NPM cotton (Organic cotton) an edge over Bt cotton. It does not mean that immediately area under Bt Cotton would be switched over to NPM (Organic cotton ). As a matter of fact, cultivation of NPM cotton has certain qualifications, of which most important is that chemical substance in any form will not be used. In other words, NPM cotton is grown entirely on natural factors as was cotton grown some 50 years ago in Pakistan ie no chemical treatment to seed, no use of chemical fertiliser and no spray of any medicine for killing/controlling pests.
In international market, price of Organic lint cotton (NPM cotton ) duly certified by any authorised international agency is almost double that of normal cotton. In Pakistan, one company has been cultivating such cotton in some parts of Balochistan for past some years and going through ginning to garments and hopefully getting very high profits. In Balochistan, we have virgin lands and we can grow Organic cotton there successfully, if the Government and the growers take the initiative and make sincere and professional efforts to make it a success.
India has planned to increase its productivity from 460 kg (2005-06 season) to the level of 600 kg per hectare, and increase its domestic cotton consumption from present level of 23.0 million bales to 32.0 million bales by the year 2010, with the intention of playing effective and larger role in world textile market under WTO regime. On the basis of recent extra-ordinary Indian performance in increasing cotton production, productivity, improving quality of ginned cotton, enhancing spinning capacity, trade circles think that India may achieve its 2010 targets without any difficulty.
Pakistan should make sincere efforts on war footing for increasing cotton production, productivity, enhancing quality of our lint cotton and increasing growers profits at least to match our increasing domestic cotton demand, failing which we would lose our edge in cotton productivity over India whereas it has already an edge over Pakistan in productivity of wheat, rice and sugarcane crops.
Last week, the Trading Corporation of Pakistan (TCP) was successful in selling some 38,000 bales cotton to local spinners and exporters at reasonably good prices. However, because of abnormally high bid of Rs 2,353 per maund for Grade III staple 1-1/32 inches reportedly from one ginner to restrict sales, TCP could not sell the offered quantity. Now, TCP has floated another Sale Tender for 30,000 bales of different grades.
It is interesting to note that local spinners exporters are evincing great interest in buying TCP stocks.
With the passage of time, concern of ginners who are holding unsold stocks is increasing which may force them to reduce asking rates by Rs 50 to 100 to make it attractive for the buyers. Ginner-sellers are offering better grade cotton at Rs 2,400 to 2,500 per maund, medium grades around Rs 2,300 - 2,400 per maund while lower grades below Rs 2,300.
Field reports indicate better cotton sowing conditions and conducive weather. One report from Lower Sindh says that cotton plants are progressing well in early sown areas and, academically, picking operation may commence in early June.
The spinners are reportedly well covered in cotton requirements to pass through lean months to new crop arrivals. However, only spinning mills, running from hand to mouth, would be in the market for cotton buying.
US is almost completing its total sales of around 22.0 million bales. China has covered most of its cotton shortfall from different foreign sources of which more than 50 percent were from US. China is planning to increase cotton area, and also productivity, to reduce the gap between domestic cotton consumption and production. However, in view of limitations in production and fast increase in cotton consumption, the gap may prompt China to import 18.5 million 480-lb bales.
World cotton production is projected at 26.4 million tons = 121.2 million bales, up by 4.5 percent from 36.0 million hectares of cotton area. Economic/trade indicators point towards increase in cotton activities and also in prices in the next cotton season.