CY24 ends with declining competitive edge in cotton sector

LAHORE: The end of 2024 brings a sobering outlook for the country’s cotton value chain, with data showing a significant decline in production and diminishing competitive advantage in this critical sector.

According to the Pakistan Cotton Ginners’ Association (PCGA), total cotton arrivals at the ginning stage reached 5.452 million bales nationwide by December 31, 2024. This represents a shortfall of 2.718 million bales, or 33.27 per cent, compared to the previous year, highlighting a considerable decrease in cotton supply.

The sharp decline in arrivals suggests reduced volumes of cotton entering the market. With the textile industry as the primary consumer, this drop could exacerbate its increasing reliance on imports. The shortfall may also lead to supply chain disruptions and potential price volatility, negatively impacting the broader economy.

A notable concern has been the performance of Punjab, traditionally the country’s largest cotton producer. For the first time in the country’s history, Punjab’s contribution to national cotton production fell behind Sindh. Despite having a significantly larger area under cultivation, Punjab reported just 2.658 million bales, reflecting a year-on-year shortfall of 34.81 per cent, or 1.419 million bales. Sindh, by contrast, recorded 2.793 million bales, with a less pronounced decline.

The disparity in performance between the two provinces is alarming, particularly given Punjab’s dominant role in national cotton production. Experts are concerned about underlying factors, such as outdated agricultural practices, insufficient irrigation infrastructure, and challenges related to seed quality and pest management, which have contributed to Punjab’s sharp decline.

District-level data reveals further disparities. Areas such as Rahim Yar Khan and Bahawalpur in Punjab, and Sanghar and Umerkot in Sindh, experienced significant shortfalls. Meanwhile, districts like Bahawalnagar, Sahiwal, and Okara in Punjab, as well as Ghotki and Khairpur in Sindh, reported more moderate declines.

The PCGA report provides a detailed snapshot of the challenges facing the cotton market, including reduced arrivals, lower sales, diminished stock levels, and disrupted market flows. The ongoing decline in production threatens not only the textile industry but also employment, exports, and overall economic growth.

Market experts stress the need for comprehensive policy measures to revive cotton production and maintain its competitive edge. Suggestions include improving the availability of high-quality seeds, adopting modern agricultural practices, enhancing irrigation systems, and addressing rising input costs. Establishing a fair support price for growers is also seen as critical to encouraging cultivation.

Experts also call for greater investment in research and development (R&D) to develop improved cotton seed varieties with higher pest resistance and yield potential. Collaboration between the government and the private sector is essential to address these challenges and ensure the sustainability of the cotton sector.

“The government must take a multifaceted approach to strengthen the cotton value chain,” experts concluded, stressing that failure to act promptly could further erode Pakistan’s position in the global cotton market.