A shorter cotton crop (August 2015 / July 2016) than expected earlier has pushed up the local cotton prices as both the domestic mills and to some extent the exporters have been buying actively since the beginning of this week. As such, despite the weaker cotton prices on the international markets, the domestic prices range from being firm to tight. The mills are reported to be buying cotton actively while the exporters are also said to be purchasing cotton sporadically.
Seedcotton (Kapas / Phutti) prices in Sindh are said to have ranged higher from Rs 2,300 to Rs 2,500 per 40 kgs, while in the Punjab they extended from Rs 2,300 to Rs 2,550 per 40 kgs, according to the quality. Thus seedcotton prices are said to have risen by Rs 100 to Rs 150 per 40 kgs since the beginning of this week in both Sindh and Punjab.
Lint prices also went up by Rs 100 to Rs 150 per maund (37.32 kgs) since the beginning of this week. Thus on Thursday, lint cotton from Sindh was said to have ranged from Rs 4,650 to Rs 4,900 per maund (37.32 kgs), while in the Punjab the lint prices reportedly ranged from Rs 4,850 to Rs 4,950 per maund, according to the quality.
According to the trade, the current year's (2015 / 2016) cotton output has been scaled down to 12.5 to 13.5 million bales (155 kgs) due to persistent rains and floods which have damaged the crop substantially and also influenced the quality adversely. Mills are expected to consume 14.5 to 15 million bales while they may have to import from 1 to 1.5 million bales of cotton from anywhere. Exporters may ship 600,000 to 700,000 bales during the current season.
Traders said on Thursday that inclement weather during the current season (2015 / 2016) led to both flower shedding and also pest attacks to the standing crop in such Sindh stations as Badin, Digri, Umerkot, Tando Adam, Sanghar, Mirpurkhas and Hyderabad. In the Punjab cotton stations badly damaging the cotton crop reportedly included Multan, Sahiwal district, Vihari, Mailsi, Burewalla, Karor Pucca, Chichawatni, Mian Channu, Pakpattan and some areas of Harunabad and the Bahawalnagar district.
According to textile circles, Tariq Saud took office as the central Chairman of the All Pakistan Textile Mills Association (APTMA) last Wednesday. Tariq Saud is a well known businessman and also the Consul General of Rumania in Karachi. He is also the Chief Executive of the Nazaria-i-Pakistan Trust Karachi. He is a director of Anwar Textile Mills Ltd, United Sugar Mills Ltd and United Paints (Pvt) Ltd. Tariq Saud has been associated with textile business for more than thirty years. Textile industry is presently facing numerous challenges which the new Chairman of APTMA will have to tackle immediately.
On the global economic and financial front, it may be recalled that the current calendar year (2015) started with large hopes that the Great Recession (2008) which started nearly eight years ago will turn the corner and begin to heal the recession in the foreseeable future. That was not being. In fact, the third quarter of this year has exemplified that the global economy is in a terrible state and requires immediate and radical attention in order to avert a depression of dire proportions. The sicknesses of the global economy are several and serious. It has even been said that China and Japan have the potential to collapse the Global Economy.
When the equity markets around the world made sharp losses at the beginning of this week, alarm bells started ringing loudly. At the end of last month, Asian markets made sharp losses. Then the Dow Jones Index tumbled as biotech scrip got crushed. Asian markets made sharp losses. Shares prices were reportedly tumbling across Europe. Asian markets witnessed sharp losses. Reports started to come in that traders were fleeing the emerging markets at the fastest rate since 2008.
One may recount and report several other indications pointing to a global economic regression of serious proportions. To begin with, the slowing of economic growth in China has vastly influenced the global economic setback on weaker Chinese data. As a consequence, the commodity rout deepened as China consumes a vast array of commodities and raw materials in its wide manufacturing program.
Besides the slowing down of manufacturing activity in China, other negative influences stalling the world economy include the wavering decision of the United States whether to increase the interest rates or decide about the interest rates later on. Thus the Federal Reserve indecision or inaction concerning the interest rates in America has bred uncertainty in all the banking centers around the world. Though the American and British economies may appear to be in a relatively better condition, there remain serious concerns regarding the economic recovery in Japan and Europe.
Besides the deepening economic problems of the Eurozone, Japan and emerging markets like Brazil which has all but nearly collapsed socio-economically and politically, Australia and Canada are also undergoing serious difficulties. Even the service sector in the United Kingdom slowed down in July 2015 compared to the previous month. Continued unemployment in Europe still signifies a serious social problem on the Continent. Moreover, the return of deflation in the Eurozone in September, 2015 does not bode well for the countries using the Euro. Furthermore, the property boom in Hong Kong seems to be abating which may influence the stocks prices adversely.
One may thus conclude that the year 2015 may remain a memorable year presently indicating that the world's economic woes are still with us with no immediate sign or signal visible that they are likely to go away in the foreseeable future. Indeed the forthcoming year viz. 2016 may continue to prolong the agonising economic malaise so widely entrenched globally.
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