On Thursday, low turnover was reported on a steady cotton market. Traders said around 5000 bales were sold keeping the turnover low. According to the brokers in Karachi, the cotton output during the current season (August 2018/July 2019) could range between 10.8 and 11 million bales (155 Kgs) on an ex-gin basis.
The prices of seed cotton (Kapas/Phutti) in Sindh were said to have ranged from Rs 3000 to Rs 4000 per 40 Kgs, while in the Punjab the seed cotton prices reportedly ranged from Rs 3200 to Rs 4000 per 40 Kgs, according to the quality.
Lint prices in Sindh were said to have ranged from Rs 7000 to Rs 9100 per maund (37.32 Kgs), according to the quality. In the Punjab, the seed cotton prices reportedly ranged from Rs 7500 to Rs 9000 per maund. Textile traders said on Thursday that the yarn market was mostly dull.
According to the Pakistan Cotton Ginners Association (PCGA), total arrivals of seed cotton during the current season (August 2018 / July 2019), upto the 15th of December 2018 was 9,962,657 lint equivalent bales (155 Kgs) from which the domestic mills have lifted 8,055,160 bales. Exporters have picked up 99,589 bales while the ginners are still holding 1,807,908 unsold bales of cotton.
Reports in the media indicated that the provincial technical advisory committee on cotton will be meeting on Friday to review the 2019 cotton action plan and consultation with the growers. The meeting will be held at the Regional Agricultural Research Institute, Bahawalpur, with the Additional Secretary, Agriculture (Task Force) in the chair. The meeting will propose recommendations for solving different issues being faced by the cotton crop.
In ready cotton sales reported till Thursday evening, 200 bales of cotton from Hasilpur in Punjab are said to have been sold at Rs 8150 per maund, 800 bales from Fort Abbas sold at Rs 8200/Rs 8350 per maund, while 200 bales from Marot sold at Rs 8400 per maund.
Reports indicated that cotton prices in China, U.S.A. and India were on the lower side. On the global economic and financial front, equity markets around the world suffered their worst year since the Great Recession of 2008. It is being reported that worsening trade tensions between America and China and weakening economic growth even in some leading economies around the world has wiped out more than Dollars seven trillions of share values as estimated on Thursday (20 December 2018).
The widespread losses on the global share markets stretching from India to Italy, France to Greece, Tokyo to Turkey and China to the United States have been massive which reportedly ranged from 10 to 50 percent as per various news on Thursday afternoon. Reasons for this financial fiasco as being witnessed on the global bourses included stiff increases in lending rates applied by the central banks across the world and the declining of the many economies globally. Indeed the Federal Reserve Bank in America liked a key interest rate for the fourth time this year. These developments have also hurt the emerging markets severely.
The precipitous fall in the values of global equities has spared no country. We are yet to see how this global financial downfall will impact the coming year, viz. 2019 and beyond, but the portents are hardly positive.
More specifically, the technology scrips and the Bitcoin values have been crippled cruelly. It has also been pointed out that these developments hardly portray a routine downturn of the global economy. The current collapse in the global equity markets is not only far-flung but also deep and far reaching.
Furthermore, the complex issues of Brexit are simply compounding the difficulties of both Great Britain and the European Union which has also hit the British economy which continues to intensify. Thus, the Bank of England has cut its growth forecast for Britain so that its economy is now estimated to grow only by 0.2 percent in the final quarter of 2018 compared to the earlier projection of 0.3 percent against the growth of 0.6 percent recorded during the previous quarter.
What many observers and analysts had been forecasting, namely a large downturn in the equity markets which will push down the global economy in a massive way has turned to be true. Thus we have entered into another large economic collapse which may turn out to be a massive recession, or a great depression.