KARACHI: The Spot Rate Committee of the Karachi Cotton Association on Friday increased the spot rate by Rs200 at Rs 17,500 per maund.
The Polyester Fiber was available at Rs 250 per kg.
Cotton Analyst Naseem Usman said the market remained steady and the trading volume remained low. He also told that that rate of quality cotton rate reached the highest level of Rs18,000 per maund while the rate of Phutti reached Rs8,800 per 40 kg.
He said the rate of cotton in Sindh remained between Rs14,500 to Rs18,000 per maund and the rate of cotton in Punjab was registered at Rs16,400 to Rs18,000 per maund. The rate of the new crop of Phutti in Sindh remained between Rs5,500 to Rs7,900 per 40 kg. Phutti prices in Punjab were between Rs5,800 to Rs8,400 per 40 kg.
Similarly, prices of cotton in Balochistan remained at Rs14,500 to 16,500 per maund while Phutti prices were high as compared to other two provinces which were Rs6,300 to 8,800 per maund, said Naseem Usman.
The rate of Banola in Sindh was in between Rs1,350 to Rs2,200 per maund. While in Punjab rates of Banola were in between Rs1,650 to Rs2,200 per maund.
As many as 400 bales of Ghotki were sold at Rs 17500 per maund, 200 bales of Sarkand were sold at Rs 16000 per maund, 400 bales of Rahim Yar Khan were sold at Rs 18000 per maund, 200 bales of Haroonabad were sold at Rs 17000 per maund, 400 bales of Fort Abbas were sold at Rs 16400 to Rs 16700 per maund, 400 bales of Ali Pur were sold at Rs 15800 per maund.
According to USDA’s latest forecast of global cotton market trends, Pakistan is all set to import 6.40 million bales (of 170 kg) in the ongoing marketing year (2021-2022). This will be the highest cotton import volume in the country’s history, following previous peak import of 5.2 million bales, recorded in FY08.
That year, cotton consumption by local spinning industry reached the 15.4 million bales mark, the only time Pakistan recorded annual cotton demand in excess of 15 million bales. Estimates suggest that cotton to MMF ratio at that time was close to 75:25, which has since dropped to 65:35 as a result of growth in knitwear segment and growing use of man-made fibre in the yarn mix.
Between FY16 to FY21, local cotton consumption averaged at 13.5 million bales – excluding Covid year (FY20) dip – with little variation from mean. Including carryover inventory from last year, USDA projects cotton consumption to reach 14.6 million bales in the ongoing year, highest since FY09, and second highest ever. Coupled with greater polyester use, this may finally spark momentum in the lifeless local yarn output, which has remained static at 3.4 million metric tons for many years now.
But missing from USDA’s equation is the fresh forecast of local cotton output, which as per GoP sources has been revised upwards to 9.37 million bales in the last Cotton Crop Assessment Committee meeting. This means USDA’s local production forecast is short by 0.8 million bales, which may be incorporated into the agency’s forecast next month.
Based on last available estimates from Pakistan’s Cotton Ginners Association, it appears that national production is very much on track to reach 9.4 million bales. Readers will recall that domestic cotton output has posted a sharp recovery, as crop yield in Sindh witnessed a rebound (while output in Punjab may remain unchanged over last year at roughly 5 million bales).
Copyright Business Recorder, 2021