‘Rupee depreciation fuels cotton price surge’

LAHORE: Cotton price reached to a record level of Rs7,300 per maund in the local market as rupee depreciation increased the commodity’s import cost, an industry official said on Wednesday.

“With jump of Rs200/maund, the price of cotton reached the record level of Rs7,300 per maund, which is the highest in the current season,” the official said. Ihsanul Haq, chairman of Pakistan Cotton Ginners Forum (PCGF) said cotton prices are already on the rise due to low cotton production.

“Now with depreciation of rupee and lack of cotton imports from India, a further increasing trend is being witnessed in the cotton market,” Haq added. Last month, government allowed cotton imports from India to meet the growing appetite of key textile industry, though it slapped tough set of rules for consignments from the neighbouring country. Government is likely to start issuing permit for import of cotton from India through land route.

Pakistan, which is the world’s fourth largest cotton producing country, falls short of around four million bales a year to meet the local demand of nearly 16 million bales. PCGF chairman said cotton price in India is also on the rise due to various factors, prompting importers from Pakistan to reconsider placing import orders. The uncertainty in cotton market has depressed buying activity, he added. “It is likely that upward trend in prices of cotton would continue in the coming days in the local market.”