A meeting of stakeholders of cotton business will be held in Karachi on Wednesday to discuss the problems being faced by ginners and growers after a continuing fall in cotton and seed-cotton prices. Minister of Textile Industry Shahabuddin will preside over the meeting and discuss the issues related to cotton business and a continuing fall in rates.
The Karachi Cotton Association (KCA), Pakistan Cotton Ginners Association (PCGA), Trading Corporation of Pakistan (TCP) and the All Pakistan Textile and Mills Association (Aptma) will participate in the meeting to seek solutions of their problems.
Ginners say growers and they are facing uncertainties because of a continuing fall in prices. They, however, thanked the government for the announcement in which it asked the TCP to consider the matter seriously to help growers and ginners.
Following the announcement, in one-week, in ready business, cotton prices rose by nearly Rs 500 per maund, to Rs 5500, official sport rate gained about Rs 450 to Rs 5350 and seed-cotton prices followed the same path, rising by Rs 200 in Sindh at Rs 1700-2300, and in the Punjab at Rs 1600-2700.
Earlier, as a result of a steep fall in prices, PCGA held several meetings to seek measures to halt the decline in rates. So, the government asked the TCP to deal with the issue, but the KCA opposed the move and called it an intervention in the free market mechanism. Both growers and ginners stopped selling their unsold stock in expectations of the TCP''s entry into the market.
There are higher expectations that prices would go up and stabilise only after TCP''s move. In the meanwhile, keeping in view the global cotton prices outlook, it is to be seen how the prices would move in the local market in days to come. Demand and supply, in fact, is a major factor behind the price trend, and this factor will decide the direction in the market in the coming days.
Sources said that the PCGA would propose the support price of cotton to be Rs 6300 per maund during the meeting. When contacted, Aptma Chairman Mohsin Aziz said," The cotton growers are not going to get any benefit from the purchase of cotton through TCP as out of the estimated 12.5 million bales for the current fiscal year, 11.5 million bales have already arrived in the domestic market and the rest of the cotton bales would arrive in the local market within the next few days. After the recent floods, some cotton bales have been damaged and are of poor quality cotton which some unscrupulous people want to sell to the government through TCP. Government is likely to face complications once TCP goes for the purchase of the damaged cotton. APTMA has always acted as an ''end user'' of the commodity and it has never been involved in any sort of exploitation of the cotton growers".
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