KARACHI: Stability in the price of quality cotton was seen in previous week, though business volume remained quite low. Textile Export Adviser Committee has issued directive to increase textile exports up to 50 billion dollars. Increase in textiles sector earnings will lead to an increase in cotton production. There is an urgent need for the government to develop a positive strategy to increase cotton production.

During the last week, cautious purchases of cotton in the local cotton market led to stability in the price of quality cotton, while the purchase of low-quality cotton remained low, resulting in very low business volume.

The shortage of fabric is decreasing day by day, while textile factories are closing down or operating partially. However, there isn’t a significant decrease in stocks due to relatively low buying from textile mills.

On Monday, October 18, the cotton production, as per a report by Pakistan Cotton Ginners Association, may decrease further. However, due to the recession in local and internationally in textile particularly in China, there’s an extreme decline in demand and prices of textile products.

The market is facing a severe financial crisis due to December’s bank closings, leading to a very poor position in payments. Businesses are expanding based on debts. Textile sector is under intense pressure due to a significant increase in gas and electricity prices.

At this time, the cost of energy is highest in Pakistan among production costs. Due to an unprecedented increase in production costs, Pakistani textile companies are not receiving import orders from China. As a result, Federal Minister of Commerce, Dr Gohar Ejaz, recently visited China with a trade delegation, expecting an increase in trade and industry with China and hoping for strengthening the textile sector, as well.

While focusing on their ambitious goal of reaching textile revenue of up to 50 billion dollars, the prominent traders in Pakistan’s textile industry have unveiled a comprehensive practical wisdom for the Textile Revenue Advisory Council.

In the province of Sindh, the rate of cotton as per quality is in between Rs 15,000 to Rs 18,000 per maund. The rate of Phutti is in between Rs 5,500 to Rs 7,000 per 40 kg. The rate of cotton in Punjab is in between Rs 16,500 to Rs 17,000 per maund. The rate of Phutti is in between Rs 6,800 to Rs 8,000 per 40 kg.

The rate of Khal, Banola and oil remained stable. The Spot Rate Committee of the Karachi Cotton Association has kept unchanged the rate at Rs 17,000 per maund.

Chairman Karachi Cotton Brokers Forum Naseem Usman has said that the rate of cotton in international cotton markets remained stable. The rate of Future Trading of Cotton closed at 80 American cents per pound.

According to the USDA’s weekly export and sales report, a total of 57,800 bales of cotton were sold for the year 2023. Vietnam remained at the top by purchasing 21,200 bales. Honduras secured the second position by buying 16,900 bales. El Salvador held the third spot with a purchase of 6,100 bales. Mexico followed by buying 3,500 bales and Pakistan stood fifth after purchasing 3,100 bales.

As many as 13, 600 bales were sold for the year 2024-25. Guatemala was at the top by buying 8, 100 bales. Honduras was second with 5,000 bales. Mexico was third with 500 bales

Vice President of China Chamber of Commerce for Import and Export of Textiles (CCCT), Zhang Zhen Ming, held a meeting with Minister of Commerce and Industry Dr Gohar Ejaz. They discussed investment and trade in China-Pakistan textiles and garments, promoting Pakistan’s textile industry, and enhancing cooperation between both sectors.

The textile sector of Pakistan is often referred to as the backbone of its economy, employing 40-45% of its total labour force. During the meeting, the China Economic Net (CEN) reported that Zhang mentioned the highly complementary nature of China and Pakistan’s textile and garments industries, highlighting immense potential for cooperation in cotton industry and trade between the two countries.

However, significant changes are occurring in the global supply chain pattern in China. I

Zhang highlighted potential benefits for trade, business matchmaking activities, and exchanges between China and Pakistan in the textile and garments industry.

An agreement has been reached between Pakistan and China to initiate joint ventures in various sectors, including textiles, in addition to the China-Pakistan Textile Summit.

Minister of Commerce Gohar Ijaz participated in the China-Pakistan Textile Summit, signing an agreement between the China Chamber of Commerce and All Pakistan Textile Mills Association. He highlighted that increased Chinese investment in Pakistan could benefit the GSP Plus scheme, while Chinese exporters could also export to GCC countries and Africa through Pakistan.

While focusing on their ambitious target of reaching up to $50 billion in exports, key players in Pakistan’s textile industry have unveiled a comprehensive action plan for the Textile Export Advisory Council. This action plan includes the establishment of 1,000 garment plants across the country aimed at boosting revenues and diversifying the industry’s product portfolio.

With an investment of $5 million per plant for 500 sewing machines, these facilities have the potential to generate annual revenue of $20 million each, while also creating opportunities for 1,000 jobs simultaneously.

A memorandum of understanding was signed between Pakistan Central Cotton Committee and CABI International (CABI) at PCCC headquarters Multan for joint research work on organic cotton promotion and integrated cotton pest control in Pakistan.

Copyright Business Recorder, 2023


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