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KARACHI: Stability in cotton prices was seen in previous week amid low business volume. There was a bullish trend in international cotton markets after fluctuation. A target of one Crore twenty seven lac and seventy thousand bales of cotton has been set for the upcoming season.

There is continues decline in the exports of textile products, as industrialists protest against abolition of power and gas concessions.

Pakistan Cotton Ginners Association officials have met with Federal Minister for Energy Engineer Khurram Dastgir to discuss the energy problems being faced by the ginning industry. Pakistan Cotton Standards Institute and Pakistan Cotton Brokers Association are actively working for the grading of cotton with the support of Pakistan Cotton Ginners Association.

As per details, in the domestic cotton market, overall cotton prices remained stable in the past week, although business volume remained low. Due to the tight conditions by the International Monetary Fund (IMF), the government has also removed the subsidy on gas after removing the tariff discount of five export-oriented industries. It is said that IMF is demanding further increase in energy tariff.

Moreover, IMF is calling for an increase in interest rates, which will further destabilize the industry, already facing a difficult situation as exports continue to decline.

The textile sector has already been facing a severe crisis. The new IMF conditions will further increase these difficulties and as a result more textile mills are likely to be closed. In such a situation, the textile mills are very cautious in purchasing cotton due to which the business volume is very low.

On the other hand, recession is continuing to rise in the international markets. There is a great financial crisis in the markets. The ginners also have a stock of about two to two and a half lakh bales of cotton. There is a fear of rains and if the rains continue, the harvest will be delayed and stocked cotton will be sold.

According to reports received from the cotton producing areas of Sindh and Punjab, cotton sowing is currently satisfactorily.

The cotton production target for 2023-24 seasons has been set at one crore and twenty seven lac and seventy thousand bales.

According to the estimates eighty three lac and thirty six thousand bales will be produced in Punjab, forty lac bales will be produced in Sindh, four lac and thirty thousand bales will be produced in Balochistan and four thousand bales will be produced in Khyber Pakhtunkhwa.

The total target area under cotton cultivation has been set at 68 lac and thirty four thousand acres, in which cotton in Punjab will be cultivated on forty nine thousand and eighty six thousand acres of Punjab, sixteen lac and fifty nine thousand acres of Sindh province, one lac and eighty one thousand acres of Balochistan and five thousand acres in Khyber Pakhtunkhwa.

The rate of cotton in Sindh was in between Rs 17,500 to Rs 20,500 per maund. The rate of Phutti, available in limited quantity, was in between Rs 6,500 to Rs 8,000 per 40 kg. The rate of cotton in Punjab was in between Rs 18,500 to Rs 21,000 per maund. The rate of Phutti was in between Rs 6,500 to Rs 8,800 per 40 kg. The rate of Khal, Banola and oil; however, remained stable.

The Spot Rate Committee of the Karachi Cotton Association kept the spot rate unchanged at Rs 20,000 per maund.

Chairman Karachi Cotton Brokers Forum Naseem Usman has said that in international cotton markets fluctuation was seen the rate of Future Trading of New York Cotton market

A 25 basis point increase in interest rates by the FED in the first three days of the week led to a significant decline in prices. However on Thursday after the arrival of USDA weekly export and sales which is positive, the rate of Future Trading after increasing by 5 American cents reached at 84 American cents.

According to the weekly USDA export and sales report, two lac thirty one thousand bales were sold for the year 2022-23.

China topped the list by purchasing one lac and seventeen thousand and one hundred (including 400 bales exchanged with Pakistan).

Vietnam was second with 43,500 bales (including 200 bales swapped from Taiwan). Turkey bought thirty four thousand and eight hundred bales and came third.

Twenty six thousand and nine hundred bales were sold for the year 2023-24.

Turkey bought 12,800 bales while Honduras bought 8,300 bales.

Meanwhile, Chairman of Pakistan Apparel Forum, Chairman of All Pakistan Hosiery Manufacturers Association Javed Balwani has said that in the first ten months of the fiscal year 2022-23, exports have decreased by three billion and seven Crore dollars.

Apart from this, the cotton production target of one Crore twenty seven lac and twenty seven lac has been set for the cotton year 2023-24.

This was shared by Cotton Commissioner Dr Zahid Mehmood in a telephonic conversation with incharge Central Cotton Research Institute Dr Sajid Mahmood.

Dr Zahid Mahmood said that the meeting of the Federal Committee for Cotton in the Ministry of National Food Security and Research was held under the chairmanship of the Federal Secretary for National Food Security and Research Zafar Hasan, in which all the members of the committee participated.

In the meeting, the cotton production target for the cotton year 2023-24 was set, according to which eighty three lac and thirty six thousand bales will be produced in Punjab, forty lac bales in Sindh, four lac and thirty thousand bales in Balochistan and four thousand bales in Khyber Pakhtunkhwa.

In the meeting, the total target of cotton cultivation area was set at sixty eight lac and thirty four thousand acres, in which cotton will be cultivated on forty nine lac and eighty six thousand acres of Punjab, sixteen lac and fifty nine thousand acres of Sindh, five thousand acres of Khyber Pakhtunkhwa and one lac and eighty one thousand acres of Balochistan.

Cotton Commissioner Dr Zahid Mehmood said that the year 2023-24 will be the year of improvement of cotton and the Ministry of National Food Security and Research should make every effort to achieve the set target of cotton with the cooperation of the relevant agriculture departments of the four provincial governments.

Chairman PCGA Chaudhry Waheed Arshad and Senior Vice Chairman PCGA Abdul Mohiman Khan met Federal Minister for Energy Engineer Khuram Dastgir in Islamabad.

In the meeting, Chairman Chaudhry Waheed Arshad discussed the problems faced by the cotton ginning industry, especially the fixed charges in the electricity bills imposed by Nepra and said that this cruel tax should be removed immediately so that the ginning industry, which was previously suffering badly will stand on its own feet and play an important role in the development of the country.

On this occasion, the Chairman also presented the budget proposal to the federal minister on behalf of PCGA. On this, federal energy minister Khurram Dastgir said that the government imposed these taxes and charges because of the pressure of IMF.

The importance of cotton and cotton ginning industry cannot be ignored. Further, the minister promised that he will include their proposal in this budget and eliminate the fixed charges imposed on the ginning industry.

Pakistan Cotton Standards Institute and Pakistan Cotton Brokers Association are actively working for the grading of cotton with the support of Pakistan Cotton Ginners Association.

Copyright Business Recorder, 2023

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