Activities on the ready cotton market slowed on Thursday as Friday through next Monday, (15th to 18th June 2018) both days inclusive, are public holidays as declared by the government. Thus cotton harvesting, ginning factories and textile mills will all remain closed for four days.
The general price idea for the outgoing cotton crop (August 2017/July 2018) reportedly ranged from Rs 6000 to Rs 7500 per maund (37.32 Kgs) on Thursday, according to the quality.
Recent devaluation of the Pakistani Rupee will result in higher prices for both raw cotton and textile products when business resumes on next Tuesday.
So, only about 60,000 bales of cotton from the outgoing crop (2017/2018) are lying unsold with the ginners. The quality of this leftover cotton is mostly below standard.
New crop (August 2018/July 2019) seed cotton (Phutti/Kappas) which was trickling in over the past few weeks has stopped arriving due to the forthcoming holidays and a handful of ginning factories which were pressing new cotton crop have also closed down due to the holidays and should resume pressing the new crop from the middle of next week.
According to traders in Karachi, the value of the Pakistani rupee has fallen against the U.S. Dollar to Rs 122 in the free market. Currency brokers are predicting that the Pakistani rupee could slide further.
Global cotton markets, including America, China and India remain tight. According to recent reports, China has bought ample cotton on the futures market, perhaps at the goading of President Trump to different countries to buy more American products. If the global leaders fail to settle their import and export tariff issues, a global economic selloff may result which could send the global economy into a recession.
India has also sold large quantities of cotton to China so that cotton prices in India could rise to Rs 50,000 per candy. Therefore, presently the cotton prices are likely to remain steady to firm globally.
On the global economic and financial front, this week has seen further political and financial erosion between the constituents of the Western World which is gradually splitting apart. Some of the topics which remain contentious between America, Canada, the European Union and some countries in Latin America are gaining seriousness.
Some of the charges being hurled at President Donald Trump include his trading approach, particularly the issues pertaining to import tariffs, which his Western Allies say pertain to his "America First" and "America Alone" doctrines which are patently ill-conceived and thus unfair and unworkable. For instance, Canada is reasserting itself by proposed tariffs on the United States as the latter is conducting unfair trade. Mexico is complaining about American trade being one-sided and is calling for bilateral approach to trade which should serve the interests of both the parties.
Last Saturday's G-7 summit ended in disarray as President Donald Trump rebuked Canadian Prime Minister Justin Trudeau and criticized Canadian tariffs on imports of American milk. Indeed Donald Trump refused to endorse a joint communique fallowing the G-7 meeting which ended on last Saturday in Canada. German Chancellor Frau Angela Merkel's disappointment with Trump's disregard for the G-7 members has angered her visibly.
President Donald Trump went on later upon arrival in Singapore to remind his Western allies that America has been paying the lion's share to North Atlantic Treaty Organisation (Nato) to protect Europe. Trump is reported to have said. "We protect Europe (which is good) at a great financial loss and then get clobbered on Trade. Change is coming".
Last month Donald Trump also withdrew from the international nuclear agreement with Iran finalized in 2015 and recently lashed out Opec for instigating volatility in oil prices at the behest of Iran. Since last year, crude oil prices are said to have risen by 60 percent. However, Opec (Organisation of the Petroleum Exporting Countries) has been blamed for stoking increase in oil prices since 2017.
In Europe, France and Italy are at loggerheads concerning the handling of an immigrant ship when on last Sunday when France dubbed Italy as irresponsible for denying the migrant ship to berth at an Italian port. Tensions have since risen and the AFP has reported that "French President Emmanuel Macron has accused Italy's new populist government of "cynicism and irresponsibility" for closing its ports to the 629 migrants.
As for the Brexit developments at London they presently seen to exude a big disappointment and failure. Therefore, it appears that the global business situation is heading for a possible disaster as presently no remedy appears at hand.