Pakistan’s cotton import bill during 9MFY22 has clocked at highest in history. At $1.2 billion, the import toll is 17 percent higher over last year. Yet, decade high cotton prices meant that importers paid more for less. Total volume imported during the 9-month period stood at 3.14 million bales (of 170 kg), compared to 3.65 million bales imported last year.

Import of fewer bales compared to last year has taken market participants by some surprise. Recall that Pakistan’s cotton bales consumption (by the milling segment) was forecast at 14 million bales (of 170 kg) by both US Department of Agriculture and Pakistan Central Cotton Committee, considered the gold standard in the cotton trading business.

Although it is intuitive that higher global prices have put a dent in demand from local spinning industry, it is pertinent to note that local cotton production is at least 32 percent higher compared to the previous year, and explains in weaker demand for imports in some measure. However, the return of industry operations to full normalcy during FY22 and improved export outlook was supposed to lift overall demand up, which does not seem to have happened so far.

Consider that domestic output + imports during FY21, using official figures from PBS and Economic Survey, stood at 12 million bales. The cumulative figure for FY22 is now expected to clock in at 13.4 million bales. Yes, higher by nearly 11 percent but with some caveats.

Consider that Pakistan’s Cotton Ginner’s Association – whose cotton arrival figures is also relied upon by USDA – placed cotton production during FY21 at 5.7 million bales (of 170 kg). PCGA’s arrivals estimate for FY22 has been raised to 7.4 million bales. Together with imports, cumulative cotton available for milling for each year stood at 10.7 million bales and 11.4 million bales. An improvement of 6.6 percent during the period – and hardly enough to write home about.

Surprisingly, there has been no news of shortage of cotton from the domestic spinning industry, or renewed signs of lobbying to resume import of cotton from India – unlike last year. That means cotton and yarn availability in the local market is sufficient to meet demand from cloth and made up apparel segment.

Which should leave us gasping for an answer to a question oft-repeated in this space: is Pakistan’s cotton requirement in fact significantly lower than the 14 (or 15) million bales figure casually thrown around by industry experts?