KARACHI: Trade activity remained bullish on the local cotton market on Monday. Market sources told that due to increase in the rate of cotton the buyers were not taking interest. The rate of cotton reached at ten years high of Rs 9800 per maund.
Cotton Analyst Naseem Usman told that supply of Phutti is 19% less than previous year. The rate of cotton is increasing due to the non availability of quality Phutti in the market. Naseem also said that due to the high prices ginners in Lower Sindh were closing the mills adding that instead of making cotton ginners were involved in trading of Phutti.
Chairman Senate Sadiq Sanjrani emphasized enhanced coordination among government and private sector in producing quality seeds and using modern research based techniques for enhancing the production of cotton.
Talking to a four-member delegation of Pakistan Cotton Ginners Association, the chairman expressed concern over the decline in cotton production in the country and emphasized enhancing coordination among Ministry of Commerce, Ministry of National Food Security and Agricultural Research Departments and private sector for enhancing the production.
The delegation led by Chairman Pakistan Cotton Ginners Association Dr Jaso Mall T. Limani briefed the chairman about substantial decrease in the cultivation and production of cotton crop in Pakistan, said a press release.
Chairman was informed that the 15 million cotton bales production have been reduced to seven million bales due to decrease in cultivation, production and unavailability of quality seeds and modern machinery.
Naseem Usman told that participants of the cotton seminar said that cotton cultivation area in the Cotton zone and production declined significantly, as growers shifted from cotton to sugarcane and maize so its output slashed from 15 million bales to 8 million bales.
In totality, this has caused losses to the tune of $36 billion over the last one decade while export of rice declined from 2.5 billion to 2.1 billion US dollars. It was feared by all experts that the production of cotton would further go down and would be standing in the range of 6.5 to 7 million bales during the current fiscal year. The production of cotton in India, Brazil, the USA and other countries have increased manifold but it was on the decline in Pakistan. Because of importing cotton from abroad, the cost of the textile sector increased by 6 percent so this sector became uncompetitive compared to other countries.
On this occasion, Federal Minister for National Food Security Syed Fakhar Imam said that there was a need to take concrete action against fake seeds and pesticides because without the improved quality of input the per acre yield could not be increased. Adviser to PM on Commerce Abdul Razak Dawood said that he opposed the policy of support price because it could not bring efficiency and productivity.
He also said that when PTI came into power, there was issue of de-industrialisation but now the textile sector was unable to meet demands to ensure timely delivery because of capacity constraints. He said that it was perceived that he supported only textile sector but it was not true.
He cited examples from the Musharraf era and reminded that the growers had demanded permission to export cotton but when he sought the viewpoint of APTMA they opposed it on the pretext first the growers should meet their demand then allow them for exports. He did not accept the demand of the APMTA and allowed farmers to export cotton after which the production of cotton touched 14 to 15 million bales.
He said that there was a genuine requirement of 200 to 300 units of ginning mills but there were 1300 units because their machinery and technology were installed in the 1950s and 60s. On fake seeds and pesticides, he said that it was a fault on the government side that needs to be rectified.
He said he opposed the support price because it made the products uncompetitive in the international market and secondly our textile sector would have to focus on productivity. He said that our cotton is white gold that will be supported at all levels. He said that the rice sector was performing well as its exports increased from $250 million per annum in 2006 to $2.1 billion last fiscal year 2019-20. Now it plans to fetch $5 billion exports of rice, he added.
Dr Jassu Mal, Chairman Pakistan Cotton Ginners Association said that the climate change was impacting cotton production negatively so there was a need of more research on it. Khalid Kokhar, Chairman of Pakistan Kissan Ittehad and a grower, lambasted the policies of different governments and stated that the growers were forced to think why they should grow cotton.
He said that Parliament passed a resolution to fix the support price of cotton but there was no attention from the government side. Federal Minister for Food Security Fakhar Imam tabled a summary before the ECC for fixing support price of cotton but the ECC rejected summaries twice.
Akash Kumar, Director Sindh Agro Industries said that Pakistan imported lint worth $9 billion, lost lint production worth $8.3 billion, faced losses of above 35 percent of cotton production value chain and losses accumulated due to loss in seed, feed meal. About oil and others in totality, Pakistan faced losses of $36 billion because of reduced production in the last one decade.
Dr Khalid Abdullah, Cotton Commissioner, Ministry of National Food Security and Research said that there was contribution of Rs100 billion, 1,300 ginning factories, 4 million seeds, 450 spinning units and $13 billion textile exports on per annum basis.
Now the cotton production, he said, was slashed from 14 million bales to 8 million bales. The area of cotton under cultivation was standing at 3.4 million hectares, which was now reduced to 2.3 million hectares so over one million area of cultivation decreased in the country. He suggested a cluster approach in order to resolve problems in the cotton sector.
Mian Anjum Nisar, President FPCCI said that the agriculture sector remained a neglected sector and when he became President FPCCI he asked the government to focus on this sector. He said that the reflection of the neglected sector had started appearing as the wheat crisis was appearing because the government did not take timely decisions.
He raised the issue of fake seeds and pesticides and asked for stern action against this crime. The government, he said, should legislate against those who are involved in such crimes because it causes losses to the productivity of the agriculture sector.
Naseem told that 400 bales of Sanghar were sold at Rs 8350, 600 bales of Saleh Pat were sold at Rs 9150, 1000 bales of Hingorja (BCI) Rs 9300, 400 bales of Pir Mahal were sold at Rs 8600, 400 bales of Gojra were sold at Rs 8800, 200 bales of Samundri were sold at Rs 8900, 400 bales of Hasilpur were sold at Rs 9000 to Rs 9100, 200 bales of Tonsa Sharif, 400 bales of Dera Ghazi Khan were sold at Rs 9250, 800 bales of Yazman Mandi were sold at Rs 9450, 600 bales of Fort Abbas, 200 bales of Dunga Bunga were sold at Rs 9500 and 1800 bales of Haroonabad were sold at Rs 9800.
He told that rate of cotton in Sindh was in between Rs 8400 to Rs 9300. The rate of cotton in Punjab is in between Rs 8800 to Rs 9900. He also told that Phutti of Sindh was sold in between Rs 3800 to Rs 5200 per 40 kg. The rate of Phutti in Punjab is in between Rs 3800 to Rs 5300 per 40 kg.
The rate of Banola in Sindh was in between Rs 1600 to Rs 1750 while the price of Banola in Punjab was in between Rs 1800 to Rs 2100. The rate of cotton in Balochistan is in between Rs 9000 to Rs 9200 while the rate of Phutti is in between Rs 4500 to Rs 5500. The Spot Rate remained unchanged at Rs 9500 per maund. The polyester fiber was available at Rs 153 per kg.
Copyright Business Recorder, 2020