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KARACHI: The Spot Rate Committee of the Karachi Cotton Association on Friday has increased the spot rate by Rs 100 per maund and closed it at Rs 11,000 per maund.

The local cotton market remained stable on Friday. Market sources told that trading volume was satisfactory.

Chairman Karachi Cotton Brokers Forum Naseem Usman while addressing a protest outside the building of the Karachi Cotton Association on called for adopting new technologies for increasing the production of cotton. He demanded that government should abolish all kind of taxes including sales tax for the revival of cotton. There should be complete ban on growing any crop in the cotton belt. He further said that government should constitute Cotton Control Board having representation of all the stake holders.

The Lahore Chamber of Commerce and Industry (LCCI) has urged the government to declare a cotton emergency in the agriculture sector as a fall in cotton production has started affecting the economic chain.

LCCI President Mian Tariq Misbah, along with Senior Vice President Nasir Hameed Khan and Vice President Tahir Manzoor Chaudhry, told the media, after a meeting on Thursday, that the lower cotton production had impacted the textile sector, other industries directly or indirectly associated with it, ginners and growers.

The LCCI office-bearers said that textile was the largest export-oriented sector, contributing around 60% to total exports of the country.

Cotton production has declined persistently since 2017-18 when the harvest was 11.9 million bales. Production declined 17.5% to 9.8 million bales in 2018-19 and further dropped by 6.9% to 9.18 million bales in 2019-20.

Rural women agriculture conference was held at Hala which was attended by more than 200 women cotton crop workers from 10 villages of Matiari district.

Poor working condition, lack of health safety measures, low wages and impact of climate change on the health of women agriculture workers were discussed in the conference.

The conference was organised by Sindh Community Foundation in cooperation with Human Rights Commission of Pakistan. Regional Director Nagina Junejo of Directorate of Labour Hyderabad, Abdul Samad Deputy Director Labour, Assistant Director Labour Noor Muhammad Lakho, Javed Soz of Sindh Community Foundation (SCF), labour rights activists Taj Maree, Raja Muhsan, leaders of women cotton crop workers unions Shaista, Sadori and Lakrhi were amongst the speakers of conference.

The cotton crop workers were of the view that they work in scorching heat but they receive less wages which does not meet the minimum wages as compare to other workers. They said they experience worst health incidents during the picking process, mainly heat stroke and snake bites are quite common but they don't receive any compensation from the landowner/growers.

Meanwhile, Cotton futures rose on Thursday as rising demand for corn and soybeans has increased expectations for lower cotton planting acres, while exports jumped to a marketing year high. The cotton contract for March rose 1.20 cent, or 1.4%, to 85.87 cents per lb by 1:45 p.m. EST (1845 GMT).

"With cand soyabean prices so high it is going to take away acres from cotton, which already has been in demand, and we're anticipating to have smaller acres going forward," said Jon Marcus, president of Lakefront Futures and Options brokerage in Chicago. Also, "prices have rallied here in tandem with the grain," Marcus said, adding, bullish exports data and rising equities have added further support to the market.

Chicago Board of Trade corn and soybean futures rose on Thursday, with end users stepping in to buy the market one day after prices posted sharp declines.

Adviser to the Prime Minister on Commerce Razak Dawood has said that the government will take measures in the coming budget to reduce the custom duty for increasing exports of synthetic fiber (technical exports).

The adviser stated this while briefing the Senate Standing Committee on Commerce about draft Textile and Apparel Policy 2020-25 on Thursday, which envisages rationalization of custom tariffs and taxation regime and offers Rs925 billion incentives for growth of textile and apparel exports to $19 billion by 2024-25.

The adviser on commence said that Pakistan has been heavily relying on 70 percent cotton exports and 30 percent man-made fiber (synthetic fiber), whereas, in other countries, situation was vice versa, with 70 percent technical exports and 30 percent cotton.

The Federal Board of Revenue (FBR) has taken a major policy decision of not reverting back to sales tax zero-rating regime for five export-oriented sectors including textile, leather, surgical, carpets, and sports goods, in the upcoming 2021-22.

Naseem Usman further told that according to sources the zero-rating regime would not be restored due to speedy payment of refund mechanism under the "FASTER" system of the Federal Board of Revenue (FBR).

There is a significant progress on account of payment of sales tax refunds under the "FASTER" system, and there is no justification of the restoration of the sales tax zero-rating regime.

"We cannot say that all refunds are paid without delay under the FASTER system, but most of the refunds are now being cleared. A presentation of the FBR to the Finance Ministry, Ministry of Commerce and other departments at the FBR here on Thursday shows satisfactory performance of the FBR regarding payment of sales tax refunds. The FBR has informed the meeting that the system is improving day by day and there is no reason for reverting back to the old system," top officials added.

Naseem told that 400 bales of Saleh Pat were sold at Rs 10,800 per maund, 1600 bales of Khan Pur were sold at RS 11,000 to Rs 11,500 per maund, 1000 bales of Lodhran were sold at RS 11400 per maund, 400 bales of Ahmed Pur East, 400 bales of Chani Goth, 400 bales of Faqeer Wali, 400 bales of Donga Bonga were sold at RS 11,000 per maund, 600 bales of Faqeer Wali were sold at Rs 10,975 to Rs 11,000 per maund, 800 bales of Bahawal Nagar were sold at Rs 10,800 per maund and 500 bales of Tunsa were sold at Rs 10,700 per maund.

Naseem also told that rate of cotton in Sindh was in between Rs 10,000 to Rs 10,700 per maund. The rate of cotton in Punjab is in between Rs 10,200 to Rs 11,000 per maund. He also told that Phutti of Sindh was sold in between Rs 3800 to Rs 5000 per 40 kg. The rate of Phutti in Punjab is in between Rs 3500 to Rs 5400 per 40 Kg.

The rate of Banola in Sindh was in between Rs 1600 to Rs 2000 while the price of Banola in Punjab was in between Rs 1800 to Rs 2250. The rate of cotton in Balochistan is Rs 11,000 per maund.

The Spot Rate Committee of the Karachi Cotton Association has increased the spot rate by Rs 100 per maund and closed it at Rs 11000 per maund. The Polyester Fiber was available at Rs 197 per Kg.

Copyright Business Recorder, 2021


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