Brokers said in Karachi that the Federal Cotton Committee has estimated the next cotton crop in Pakistan (August 2017/ July 2018) to be 14.040 million bales (170 Kgs) from which Punjab may produce ten million bales, Sindh to produce 4 million bales and Khyber/Paktunkhawa 40,000 bales.
Sowing in Sindh province is just slow due to shortage of water and in Punjab it will start after the 15th of April 2017. Even if cotton prices have remained steady to tight, yarn prices presently are said to be slack.
Textile mills in Pakistan have been underperforming and not doing well over the past several years, particularly in the Punjab province. The leadership of the All Pakistan Textile Mills Association (APTMA) has warned the government of the serious consequences Pakistan will suffer and is also undergoing, particularly in Punjab, where a large capacity is closed. APTMA central Chairman, Aamir Fayyaz, has listed the causes for the large scale de-industrialisation of the industry such as being energy prices disparity and liquidity crunch which has seriously imperilled exports and employment in the country. Also attending the APTMA press conference were group leader Gohar Ejaz and Vice Chairman Ali Pervez along with APTMA Punjab Chairman Syed Ali Ahsan.
APTMA leaders pleaded with the government to rationalize taxes, provide quick and timely returns of taxes and other refunds to increase textile exports by ten percent of the Gross Domestic Product (GDP). The APTMA leaders reiterated to the government that the overall exports have fallen by Dollars 5 billions while the textile production capacity equivalent to Dollars 4 billion is lying idle due to incompetitiveness. APTMA Punjab Chairman Syed Ali Ahsan said that more than 70 percent of the country's textile industry is located in Punjab where its viability has been hardly hit due to energy price disparity. APTMA has pleaded for implementing a unified energy price for the textile industry throughout the country.
One sale of new crop (2017/2018) seed cotton from Badin comprising of 6000 maunds has reportedly been sold to a ginning factory in Shahdadpur in Sindh at Rs 3400 per 40 Kgs for delivery between 5 and 20 June 2017.
On the global economic and financial front, the general feelings amongst investors, trading circles and the bankers has been that with Donald Trump at the helm of affairs in the world's largest economy, he would cut taxes and increase fiscal spending to bolster the American economy. In turn, other economies around the world will follow a similar pattern and thus push up the global economy into undue competition which had being lying in limbo since most of the past ten years.
However since last November (2016), there are speculations that the European Central Bank would not tighten the monetary policy like the American Federal Reserve but would rather postpone it for the time being due to the recent setback Trump received in the House of representatives last Friday when his own Republican party members did not sufficiently support the healthcare.
Thus most equity markets turned lower at the beginning of this week last Monday, but recouped their losses as the week went ahead. Earlier headlines at the beginning of the week informed that FTSE had hit one-month low levels due to failure of U.S. president Donald Trump to get his healthcare bill through Congress. Thus shares prices similarly slumped in Europe, China, the Middle East and Tokyo. Later in the week, however, several shares indices were reported to have snapped their losing streak such as FTSE, Wall Street, Nikkei and in India and China.
There do appear several signs of a sustained global economic recovery, but we may take this factotum of recovery with a modicum of caution. Anyhow, some reports are positive such as the report that global trade growth has hit a seven year high level, but lurking fears remain that a trade war may yet emerge between America and China due to protectionist policies. On the other hand, it has been reported that the global business confidence has hit a fresh six-year high level.
Commenting on the state of the American economy, the head of the Federal Reserve Bank of San Francisco John Williams had reportedly said that the U.S. economy is back to normal. According to Williams, "America has finally achieved the hard-sought recovery we have been after since the past nine years". Thus the Federal Reserve reportedly believes that American economy has achieved normalcy because "the unemployment which had risen to a peak of ten percent during the Great Recession" has reduced to 4.7 percent, or nearly full employment. Williams also believes that Fed's goal of inflation at two percent has been achieved.
Many observers and analysts still deem any economic growth and recovery in America, Germany and elsewhere as essentially ephemeral, even though consumer confidence is said to be at the highest level since the year 2000. Be that as it may, the Republicans in America see the American economy on a healthier footing but the Democrats still feel uneasy regarding any lasting economic recovery in America. Thus the good health of the global economy may have to wait till its stability is ensured.