15-day strike by CGA decreases prices of cotton, phutti

Cotton Ginners Association''s (CGA) fifteen days long strike has decreased the prices of both cotton and phutti, in the local markets of Punjab and Sindh, crushing the poor farmers already under burden of different inputs price hike. Well-placed sources told Business Recorder here on Saturday that the price of cotton in the local market of Sindh has decreased from Rs 6400 per mound to Rs 6000 per mound while in Punjab its price has reduced by Rs 400 from Rs 6800/mound to Rs 6400/mound.
Same is the case with phutti. The price of the commodity had also reduced by Rs 200/ mound in Punjab and Sindh. Pakistan Cotton Ginners Association (PCGA) stopped buying Phutti 15 days back in protest against the complex procedure of collection of 3.5 percent withholding tax on purchase or sale of Phutti. Sources said that the new tax provision means that the ginners are required to collect tax from growers that would translated into Rs 100 per maund sale or purchase of Phutti.
According to the sources, the recent monsoon spell has made the poor farmers to pay heavy costs. With the proposed withholding tax, the cotton growers have already started feeling insecure and are thinking of sowing other crops next year. "The country may lose a major share in the world cotton market if the situation persists", sources said.
They said that in spite of the fact the recent monsoon rains in the Sindh province, especially in the Lower Sindh have caused major loss to the Kharif crops, especially cotton as it has destroyed 60-80 percent of the crop, the country is being expected to produce almost 14 million bales for the 2011-12 which clearly means that we would no more require to import 2.4 million bales from India which would save our Rs 3.5-4 billion while by exporting one million bales, the country can earn Rs 2 billion in 2011-12.
Pakistan missed the cotton production target for 2010-11 by producing 11.7 million bales against the target of 14 million bales due to devastating floods. The estimated loss to the cotton crop due to last year''s flash floods in cotton growing areas of Punjab and Sindh stood over Rs 120 billion.