Cotton arrivals: season closes?

The cotton arrivals are petering out, exactly as was predicted in this space. It looks like the output target – set by the Federal Committee on Agriculture in March 2023 at 12 million bales (of 170kg) –will be missed by 33 percent, with maximum cotton arrivals for the Kharif 2023 – 2024 settling in between 8.3 million – 8.4 million bales (of 170kg).

Although it looks as though the cotton output has increased by 70 percent over the last year, the much-celebrated performance largely owes itself to the massive low base effect from the previous year. Cotton arrivals during the 2022-23 monsoon flood season had clocked in under 5 million bales, which was Pakistan’s worst performance in 50 years.

Amidst this celebration – however – what has been missed is a discussion of crop yield performance. During the last meeting of the Federal Committee on Agriculture in October 2023, the estimated area under cotton crop cultivation was reported at 2.4 million hectares, meaning that the average national yield will be well under 600kg per hectare.

While the national average yield performance may not appear so bad when compared to recent years, it is worth remembering that the 3 out of 5 cotton crop seasons met with extreme weather events, where yield was lost to extreme rains, floods, and pest outbreaks.

For a normal year, an average national yield performance of 570kg per ha is extremely poor, especially when one takes into account that the current crop season has been hailed as a year of cotton revival in the country.

But that’s only part of the story. The story gets much worse when one looks at province-wise breakdown. Historically, cotton acreage between two irrigated provinces of the Indus Basin – Punjab and Sindh – has been 70-30. This year too, this mix has remained largely unchanged.

Now consider that the cotton arrivals of 8 million bales received during the current season have been evenly divided between the two provinces. This means that at the average/estimated crop area under cultivation of 0.6 million hectares, Sindh has scored a provincial mean yield above 1,100kg per hectare, whereas the same for Punjab may clock in close to 350kg per hectare.

The above-average yield of 350kg per hectare for Punjab province – if correct – isn’t just abysmal by historic standards, but it is also a horrible performance in a geography where cotton is primarily grown across irrigated plains. India, where much of the cotton is grown in non-irrigated plains, still managed to average national yield close to 500kg per hectare, despite similar weather patterns, poor seed quality, small average landholding size, and other comparable ground realities.

Since both the federal and provincial governments have hailed the rebound of cotton crop performance in Punjab as a yardstick for their effective governance, they must be asked: what exactly went wrong with the crop yield? The fact that cotton crop prices have remained depressed throughout the peak harvest season, in fact means that the farmers in the province who chose to grow cotton by bringing more acreage under the crop has actually lost money. Even if the base effect from last year makes the economic performance and GDP metrics appear rosy. And these growers won’t forget their losses come next year. Beware!