Wednesday September 28, 2022

Cotton stockpiling up 93.7pc; govt expects to exceed target

October 19, 2021

ISLAMABAD: Ginners recorded a 93.73 percent rise in cotton stockpiling, collecting 5.208 million bales till October 15, 2021 with government expecting to meet or exceed this year’s revised target of 9.3 million bales.

Ginners had collected 2.688 million bales till the same period last year. According to the Pakistan Ginners Association (PGA) fortnightly report on Monday, inflows stood at 1.362 million bales this year, up from last year’s 0.781 million bales. This year’s bi-monthly inflow is 581,009 bales higher than last year, raising hopes for farmers who suffered from last year’s low yields.

Ginners in Punjab and Sindh collected 2.266 million and 2.942 million bales, respectively. Arrivals from Punjab increased 86.7 percent, while from Sindh the amount doubled.

By end of the cotton season, government expects 5.44 million bales from Punjab, 3.5 million bales from Sindh, 0.43 million bales from Balochistan, and 4,000 bales from Khyber Pakhtunkhwa.

Of the total 5.208 million bales, 4.4074 million were sold (4.393 million bales to to textiles and 13,800 bales to exporters), while 187,815 bales were unsold stock and 613,144 bales was unginned stock.

The Federal Committee on Agriculture (FCA) on October 7 had also raised the cotton production forecast by a million bales, expecting to get 9.374 million bales by the end of this season. The government had fixed the cotton production target for 2021-22 at 10.5 million bales against last year’s production of 7.06 million bales.

The plan was to cultivate cotton on over 2.33 million hectares, but according to latest data shared in the FCA, the crop was cultivated on only 1.9 million hectares, which agriculturists attributed to lack of government incentives.

Cotton intervention price was announced at Rs5,000/40kg for cotton crop 2021-22, but the announcement was made too late as the sowing season had ended weeks earlier.

In the absence of government support to cotton, farmers turned to planting other crops, including sugarcane, rice and corn due to better price, lower vulnerability to pest attacks and government support.

Cane producers get support price, and are guaranteed a fixed price with the mills. Rice being a major export commodity of the country also fetched a good price in the international and local markets. Corn is another important crop that is a major ingredient in poultry feed, thus fetching a good price in the local market.

It is to be noted that despite lower cotton production in the last fiscal, Pakistan’s textilesector came back to full capacity. In FY21, textile exports went up 22.94 percent to $15.4 billion. Due to low production and high demand, the shortfall was met through imports of over six million bales.

This year, the sector appears to be on track to achieve higher exports and also in the long run would need to import cotton.

In order to realise export-led growth in this sector, the government of Pakistan is finalising Textile Policy 2020/25. It aims to make Pakistan more competitive globally. But unfortunately, the Economic Coordination Committee (ECC) of the cabinet last week failed to muster its support to the policy.

It constituted a sub-committee to resolve the issues pertaining to subsidised power and gas and then submit the report to the committee again.

Federal Minister of National Food Security and Research Syed Fakhar Imam through an official statement said, “We are on course to meet or even exceed the revised target for this year of 9.3 million bales.”

He advised farmers to adopt clean picking practices to attain higher cotton grades so they could obtain import parity price. He further advised farmers to keep a close eye on weather forecasts to timely adjust field operations to avoid losses. He warned market speculators to refrain from spreading rumours about production figures to create market instability. He reiterated that the government was all set for intervention if prices dropped below the policy price threshold.

Imam said that the government's focus on cotton revival through input subsidies, provision of better-quality seed with higher germination rates, and intervention price policy of Rs5,000/40kg, was bearing fruit. Higher cotton prices were significantly raising incomes of farmers.

He said hard work of cotton farmers and conducive weather have helped with higher yields as well as production. “Higher cotton production this year will considerably increase textile output and exports, edible oil from cotton seed, cotton cake for animal feed, and fuel wood for rural households. Income of cotton pickers, largely women, will also increase substantially. Higher cotton production this year, with its multiplier effect on the economy, will boost the GDP,” he added.