Pakistan Cotton prices likely to remain on rising tide

Pakistan Cotton Ginners Association (PCGA) has issued fortnightly figures of domestic cotton production and accordingly all country-wide ginning factories have so far received seed-cotton (phutti) equivalent to 9,582,560 cotton bales up to 30th November, 2012, that’s 67,542 bales (0.7pc) less to previous year corresponding arrivals. However according to PCGA report, seed cotton arrivals in ginning factories of Punjab are 6,605,379 bales up to 30th November which are less to the tune of 934,930 bales (12pc) than corresponding period of last year whereas arrivals in ginning factories of Sindh are 2,977,181 bales that are 867,388 bales (41pc) higher than corresponding year.

The PCGA report further informs that textile mills have purchased 7.650,373 cotton bales from the ginning factories, among which 159,740 bales have been exported whereas 1,772,447 bales are lying unsold with the ginning factories during the said period, including 1,169,446 pressed bales and 603,001 un-pressed bales (in shape of phutti).

According to the PCGA report, the leading cotton producing district is Sanghar with arrivals of 1,228,846 bales that constitute 13pc of total arrivals of Pakistan and nearby 41pc of arrivals in Sindh.

Ihsan-ul-Haq Ex-Executive Member of PCGA commented that due to unexpected shortcomings in phutti arrivals the textile mill owners may opt for enhanced cotton imports but due to increasing value of dollar and rising price of cotton in international market it may not be economical hence cotton prices in Pakistan are expected to remain on rising tide.

He further told that at the start of sowing season of current cotton crop, the Meteorology Department announced 43pc more rains during cotton sowing 2012 so most of the farmers in riverine belt of Sindh and Punjab opted for planting paddy instead of cotton hence corresponding fall in cotton production area and rain damage in some cotton growing pockets may be the main reasons for the shortfall in phutti arrivals.