Rains were playing havoc in major cotton belts causing concerns among the sellers and buyers to think and rethink whether or not sell/ buy until monsoon has changed absolutely. However, buying and selling remained dull and spot rate finding not much space to budge either way. The spot fell on the opening day by Rs 25 to Rs 2450.
On the opening day futures banked on trade and speculative buying to close firmer. The market reeled from robust speculative sales following release of USDA monthly supply/demand report, which only slightly reduced its estimate for US 2006/07 cotton production to 20.43 million bales from 20.5 million bales. The analysts said the problem with the USDA data is that it was assuming normal weather while Texas condition had disturbed all.
On Wednesday late speculative sales and market could trade in a band while waiting for fresh leads over the next few sessions. The market is eagerly watching the Texas conditions and are mulling what kind of demand will emerge. The market is also looking for weekly export sales to have a grip over situation. The Thursday trading and weather will give some hold on trading outlook, market participants said.
On Thursday futures turned softer as speculators indulged in light trading. The dry spell in cotton belts is drawing attention with added worry as the days pass by. The USDA however came out with weekly export sales data . It put total cotton sales a 79,300 RBs higher than last week. Shipments were noted at 246,000 RBs, sharply down from previous week.
Shipments were slow stated to be due to 2006-07 marketing year (August-July) was just underway and cotton crop was maturing. On Friday the contracts showed weakness for third straight day as no fresh news to give new life to cotton trading was in view. However, October on the day was down 0.40 to 52.40 and December down 0.34 to 54.52 cents a pound.
On Tuesday however holiday mood was more apparent. A few scattered deals were said to have been done but only one deal was reported . The local cotton growers paid no attention to what was happening in Texas and other top cotton producing areas of South America. The growers were worried indeed for what was happening in Pakistan the heavy rains will boost production or will spoil quality was being pondered.
From Wednesday rains forced the ginners to lower prices depending on quality. Earlier they had objection in cut in prices as they had to buy seedcotton (Phutti) at the govt fixed prices over 950 per 40 kg.
But apprehension that unusual rains without allowing gap for picking had been spoiling quality. The authorities have been also averring and started thinking cotton target at 13.8 million bales. A solo deal was struck for 500 bales at Rs 2475.
On Thursday heavy rains added to the worries of the cotton consumers as crop and quality were to be damaged. That will follow the price war between the buyers and sellers. The official spot rate of new cotton was unchanged at Rs 2450. However, the heavy rains have also been causing ginners concern. The stocks may also get yellow lying in some not very fair places. Market sources felt that situation is developing in such a way that both have paused and started thinking how to act for the time being.
On Friday dull market fully evident as market operators reported no business. They presumed that normal trading may start from Monday if rain do not disturb the possibility. Spot rains received firm at Rs2450.
But buyers with strong links with Islamabad made cotton a plaything. Ginners claim they were simply ignored about cleaned cotton and mixed up with so called contaminated cotton. For the last few years, though without much success govt has been serious and stressing on making Pakistan contamination cotton supply a culture. Of course some premium was assured. But supplies remain rather need has gone up but culture sort of any thing has not been seen or heard. If was thought the TCP will patronise such cleaned cotton by buying from ginneries fixed for the purpose.
But a "culture" has certainly not been made or atleast heard. Some encouraging sings were marked when some ginners made journeys to Turkey, Italy, India and perhaps more places to visit ginneries how contamination culture is being produced. But nothing was heard thereafter. The other day a revealing news report was to bank saying clean cotton plan to be undertaken again. For the purpose 13000 skilled men will be produced to make the work of cleaning cotton easy.
But nothing has been further to information where is the training being held. Besides, the report said that like last year the govt intended a R s35 million project for contamination free cotton production as part of Clean Cotton programme. And for this the Mintex has requested ECC for approval of Rs 5 million as supplementary grant for launching programme for 2006-07, the Printex plans to produce 100,000 bales of clean cotton under this programme 70,000 bales from Punjab and 30,000 bales from Sindh.
The producers will be paid Rs 50 premium- 50 percent of which will be borne by the federal govt and the rest by the two province. The report say that TCP had last year initiated a Rs 35 million project, but it did not materialise and Rs 30 million is lying with the corporation. But the way Rs 5 million was spent last year has not been clear. God help launch in 2006-07.
And look but for the continuous shortfall in what is being depended upon, is horrendous. The country had not to cite any period of its now 60 years that prosperity ruled on top. Prosperity not the below 10 percent people enjoy. Take any newspaper right firm 1947, you will find authorities promising pure drinking water, gas, electricity and of course affordable food stuffs. But go to the squalid areas of the city that abounds from hopeful people for a job, two square meals and some savings for his/her dear ones.
A recent report said that authorities received Rs 149 million from privatisation and frank admission followed that 90 percent was thrown into debt retirement at the first instance and the rest optimistically spent on roads, water reservoirs health, education and what not to supposedly reach to the comfort of poor. The SBP authorities have been hunting undertone they had to speak in good English incomprehensible to those who ruled the successive past govts.
Probably they thought since America with so much natural resources and all sorts of technologies indulging in spend thrift activity like space flights etc Pakistan could go US way and indulge in misadventures. What huge deficit we take about? Can anybody show trade deficit skipped for one day one month or a year? The economists have been awaiting for the last 60 years rulers will count on them or should work as they work out the complex figures gathered from statistical institution, Only God knows when their wait will bear friution or they will remain part of ever weakening Pakistan.
Besides, two names the later reports several branches of cotton, spinning, textile, garments and of a processing sector emerged. All they had to tell their own stories which in short was that it became for even the authorities who they wanted to help with the package while others were left out. Despite now dust selling the image of actual sector who demanded and who got is impossible to track down.
However, the tie is such that a few days were left when according to textile people exports will have to be expedited so that Pakistani exporters are not left out as India, China, Bangladesh, Malaysia, Thailand and even Vietnam are already entrenched in the markets. Leave aside package who got it who missed make Pakistan a die hard value added textile products exporting country. Cotton, low count cotton yarn and grey cloth export is not what Pakistanis are being asked to wake up.
The garments, apparel, towel, hosiery and Knitwear are expected are drawing exporters attention. The WTO has been in the play which for those who compete the exports through regular investment adoption of new designs, the buyers choice upper most in the mind high quality and low price. All these qualities make Pakistani exporters shaky.
They have in abundance what God has given to this country but alas! The qualities should be in aggressive exporters are singly invisible. This is export time what exporters you wanted has been given. How it our turn to return to the country.
Had July 24, meeting in Geneva, as expected all powerful and powerless had loosen their stiff neck for teeming million of the world the result would have been all smiles. But what the world saw was that the all but one member had reservation due to approaching no elections and adverse legislators attitude. They were adamant not to part with another side of the butter. Naturally Pascal Lamy announced at the end of meeting that talks were suspended.
And since be certainly did not want history to remember him as failed WTO chief expressed in optimistic tone that he still was hopeful some ways would be found. All eyes are on 2006 end, when someone will be able to discover Aldain's lamp and call in the giant with thundering sound as king Lamy, "order Aga what do you want and called me for". But with the passage of time -over five years, the lamp dimmed and finds to day few people deserve.
In good old days such fanciful tell tales were created to all powerful of those days who would sit with their dedicated and full of service sentiment and deliberate ways to deliver goods to needy people. But since such "Agas" have travelled beyond blue skies, the Aladin's lamp has gone rusted and hence giants don't respond today.
It is pertinent to place here the ILO's 2006 global employment tend painting a sober picture not only of the growing unemployment and poverty but significant lack of decent job opportunities. At a time when sombre picture was being panted, poor of the world were not altogether wrong to pin hope in the positive outcome of the WTO. Under such sober condition how the rich will be able to create 40 million jobs each year over the next decade. The ILO has shown the way govts have to look for ways to feed unemployed. The WTO in its true colour can possibly create what ILO thinks has to be done by leaders.
The age limit for senior citizens reduced from 65 to 60 years. The point needs explanation as to when this would be enforced. He demanded immediate notification for zero rated ST. In a letter to CBR chief he also desired that the custom CARE system should be introduced at all ports. He demanded revision into increase from 0.01 pc to 0.02 pc on withdrawals exceeding Rs 25,000.