Weekly Cotton Review: Market stable amid subdued business activity

KARACHI: The cotton market maintained an overall stability trend with no significant changes observed in prices, however, market activities remained subdued due to business being conducted at a limit level.

According to the latest statistics, cotton production in Sindh has surprisingly remained sixteen percent higher compared to Punjab, which clearly highlights the production difference at the provincial level.

According to the situation as of December 15, Punjab recorded a production of twenty four lac and fifty three lac bales while Sindh recorded a production of twenty eight lac and fourty eight thousand bales. This information was provided by Ehsan-ul-Haq, who shed light on the production comparison between both provinces.

Business remained severely affected due to the transport strike and market activities remained significantly lower than usual, which caused traders and business circles to face difficulties.

On the other hand, the Evacuee Property Trust Board, with the assistance of the Federal Investigation Agency, has taken possession of the Karachi Cotton Association building since December 12 and sealed it, due to which cotton’s daily spot rates could not be issued for the first time in the last fifty-three years. This situation is extremely unusual for the cotton market as it represents a major disruption in a tradition that has been continuing for several decades, and the trading community faces difficulty in making business decisions due to the unavailability of daily price information.

Chairman of the All Pakistan Textile Mills Association Kamran Arshad said that the situation of the textile industry across the country is extremely worrying and a crisis-like condition exists in the industrial sector.

So far, one hundred and forty-four textile mills have been shut down while the closure of textile mills and spinning units continues persistently, which is a cause of extreme concern not only for the industrial sector but also for the national economy. This situation is affecting the employment of thousands of people and is also having negative impacts on exports.

He appealed to the government to take immediate measures for the revival of the industry.

The local cotton market witnessed overall stability in prices during the past week. Demand for quality cotton is particularly increasing. Several mills are showing interest in quality cotton, which is causing the price of quality cotton to improve relatively.

However, business remained affected due to a prolonged transport strike. Several ginners are stocking quality cotton in anticipation of better prices. The supply of lint is decreasing day by day, which has led to the belief that while a good cotton crop was expected at the beginning of the season, it now appears that the crop may be around 55 lac bales.

Cotton production in Sindh is surprisingly 16 percent higher than Punjab. By December 15, production reached at twenty four lac and fifty three thousand bales in Punjab and twenty eight lac and fourty eight thousand bales in Sindh.

The Pakistani textile and cotton industry is going through the worst economic crisis in the country’s history due to excessive taxes, the highest electricity rates in the region, and imports of cheap yarn and fabric from China and other countries.

Currently, more than 144 textile and spinning mills and over 400 ginning factories have already become non-operational.

The shutdowns have resulted in a significant decrease in raw cotton purchases, national cotton production has shrunk to dangerous levels, and there is a risk of further decline in foreign exchange reserves due to increasing imports of edible oil and textile products.

APTMA Chairman Kamran Arshad stated that industries in the country will only prosper when electricity is available at 25 rupees per unit, not 35 rupees per unit. Electricity in Pakistan is more expensive than in India, Bangladesh and Vietnam. He revealed that 19 percent less electricity was consumed in November.

Arshad said that the closure of these units has resulted in decreased exports of textile products. He also demanded that the interest rate be brought down to single digits.

The Chairman of the Cotton Ginners Forum, Ehsan-ul-Haq, issued a warning in a statement that the unbridled influx of imported yarn, the majority of which is under-invoiced, has devastated the domestic spinning industry.

He stated that instead of providing relief to restore cotton production and boost exports, the sector is being crushed under heavy taxes and prohibitive electricity rates. This unprecedented crisis has left millions of families unemployed.

The Evacuee Property Trust Board has seized and sealed the Karachi Cotton Association building with the assistance of the Federal Investigation Agency since December 12, which has resulted in the daily spot rate for cotton not being issued for the first time in the past 53 years.

In the provinces of Sindh and Punjab, cotton prices are ranging between 14,000 to 16,200 rupees per maund depending on quality and payment conditions. The price of Phutti remained between 6,000 to 8,200 rupees per 40 kilograms.

In Balochistan province, cotton prices remained between 15,300 to 16,200 rupees per maund while Phutti prices stayed between 7,400 to 8,500 rupees per 40 kilograms.

Balochi cotton prices remained between 16,000 to 16,200 rupees while Primark cotton prices were approximately 17,000 rupees.

Naseem Usman, Chairman of the Karachi Cotton Brokers Forum, reported that international cotton prices generally remained stable.

New York cotton futures prices ranged between 63.75 to 66.43 American cents.

Meanwhile, the country’s textile exports have shown disappointing performance during the first five months (July to November 2025-26) compared to the same period of fiscal year 2024-25.

According to the monthly report on the country’s textile and garment exports by the Pakistan Textile Council (PTC), the textile sector remained the largest contributor, with exports reaching 7.84 billion US dollars, representing a growth of 2.8 percent compared to fiscal year 25 and accounting for approximately 61 percent of Pakistan’s total exports.

However, textile exports in November 2025 experienced an 11.7 percent monthly decline along with a year-on-year decrease of 2.7 percent.

The country’s cotton sector has expressed serious concern over the sharp shortfall in cotton production against the targets set by the Federal Committee on Agriculture (FCA) for the 2025-26 season.

The FCA had fixed cotton cultivation targets for Punjab at 3.46 million acres with a production goal of 5.553m bales (170 kg each), for Sindh it was 1.556m acres with a production target of 4.040m bales.

However, the data released by the Pakistan Cotton Ginners Association (PCGA) up to Dec 15 shows that actual production stood at only 2.453m bales in Punjab and 2.848m bales in Sindh, triggering widespread concern across the entire cotton value chain.

Despite Sindh’s production target being 37 per cent lower than Punjab’s, cotton output in Sindh remained surprisingly 61pc higher than Punjab’s by mid-December.

A total of 5.3m bales had arrived at ginning factories across the country by Dec 15, reflecting only a one per cent increase compared to the same period last year.

The PCGA report shows that during the said period, 2.453m bales reached ginning factories in Punjab, registering a five percent decline compared to last year, while Sindh recorded 2.848m bales, showing a three percent increase. During this time, textile mills purchased 4.491m bales from ginning factories, while exporters bought 175,000 bales.

Cotton Ginners Forum Chairman Ihsan-ul-Haq has questioned the FCA’s projected per-acre yield figures.

According to FCA targets, per-acre cotton productivity this year was estimated at 9.80 bales in Punjab and 15.84 bales in Sindh. “It is incomprehensible how Sindh’s per-acre cotton yield can be 61 percent higher than Punjab’s,” he remarked.

He criticised the FCA for issuing unrealistic national cotton production estimates for several consecutive years. “These impractical targets are never achieved, yet the FCA continues to release inflated figures every year, creating serious difficulties for cotton stakeholders in formulating effective strategies,” he said.

Meanwhile, the building of the Karachi Cotton Association (KCA), which has served as Pakistan’s identity in cotton matters worldwide since its establishment in Karachi in 1935, was taken into custody by the Federal Investigation Agency and the Evacuee Trust Property Board on Friday, declaring it federal government property.

As a result of this action, the KCA was unable to issue the country’s cotton spot rates for the first time in fifty-two years, marking an unprecedented event of its kind in the nation’s history.

They explained that Pakistan’s recognition in cotton affairs throughout the world, including within Pakistan itself, has been represented through the Karachi Cotton Association building. This development has disrupted the association’s decades-long role in determining domestic cotton spot rates, a function it has performed continuously since its inception.

Copyright Business Recorder, 2025