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ISLAMABAD: The World Bank has projected around 34 percent decline in Pakistan’s cotton production and estimated at 8.9 million bales for 2020-21 compared to 13.2 million bales in 2019-20.

The bank in its latest report, “Commodity Markets Outlook", stated that the global production of cotton is projected to fall eight percent this season, led by declines in the US, India, and Pakistan, mostly due to reduced plantings.

Cotton prices are expected to average 23 percent higher in 2021, compared to 2020, followed by a small increase in 2022.

Cotton prices surged 16 percent in the first quarter of 2021 following a strong gain in 2020Q4.

Although prices retreated in April, they are still 40 percent higher than their trough in April 2020.

The overall price strength reflects upward revisions to the outlook for global consumption, which is expected to average 24.5 mmt in the current season, almost eight percent higher than 2019-2020, it added.

The bank has project Pakistan’s cotton import at 11.03 million bales for 2020-21 compared to 5.55 million bales in 2019-20.

The report has projected Pakistan’s wheat production at 25.2 million metric tons for 2020-21 compared to 24.3 million metric tons.

The bank has projected Pakistan’s sugar production at six million metric tons for 2020-21 compared to 5.3 million metric tons in 2019-20.

Sugar stocks have been projected at 1.4 million metric tons for 2020-21 while the same was estimated for 2019-20. The bank has projected Pakistan’s rice production at 7.6 million metric tons for 2020-21 compared to 7.2 million metric tons, while exports have been projected at 4.1 million metric tons in 2020-21 compared to 3.8 million metric tons.

The report has projected fertilisers production at 2,973 thousand tones for 2020-21 compared to 2,978 thousand tones in 2019-20.

Further, fertilisers consumption has been estimated at 3,267 thousand tones for 2020-21 compared to 3,435 thousand tones in 2019-20.

The report noted that commodity prices continued their recovery in the first quarter of 2021 and are expected to remain close to current levels throughout the year, lifted by the global economic rebound and improved growth prospects.

However, the outlook is heavily dependent on progress in containing the COVID-19 pandemic as well as policy support measures in advanced economies and production decisions in major commodity producers.

Energy prices are expected to average more than one-third higher this year than in 2020, with oil averaging $56 a barrel. Metal prices are expected to climb 30 percent; and agricultural prices are forecast to rise almost 14 percent. Almost all commodity prices are now above pre-pandemic levels, driven by the upsurge in economic activity, as well as some specific supply factors, particularly for oil, copper, and some food commodities, it added.

Copyright Business Recorder, 2021

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