Thus seed cotton prices in Sindh reportedly ranged from Rs 2800 to Rs 3000 per 40 Kgs, according to the quality on Thursday, while in the Punjab they are said to have ranged from Rs 2800 to Rs 3050 per 40 kilogrammes. Lint prices in Sindh said to have ranged from Rs 5900 to Rs 6250 per maund, while in the Punjab they reportedly ranged from Rs 6200 to 6300 per maund.
It has also been reported that demand for yarns and other textiles has improved and thus sales of these items by the mills has increased. Traders said that arrivals of seed cotton have increased and exports of textile items have also gone up.
It is no believed that this season (August 2017/July 2018) Pakistan is likely to produce anywhere from 12 to 12.5 million bales (155 Kgs) of cotton while the domestic mills consumption is being projected to be between 13.5 million and 14 million bales. Exporters could ship 200,000 to 300,000 bales of cotton while the domestic mills may import from 1.5 to two million bales. The ginners are said to have made ready sales for the next couple of weeks and further sales would fully materialise after ten or twelve days following Ashura.
Thus the cotton market is in a steady and stable condition. International cotton is also said to be good and holding steady but Indian Cotton prices are reported to be under pressure.
According to the cotton arrivals report issued by the Pakistan Cotton Ginners Association (PCGA), seed cotton arrivals till the 15th of September 2017 were 2,365,555 bales from which domestic mills lifted 1,824,790 bales. Exporters are said to have picked up 95,057 bales while the ginners were said to be holding an unsold quantity of 445,708 bales.
On the global economic and financial front, even though economies of the United States, Eurozone and United Kingdom have shown improvement, but the rates of recovery are not showing a complete or optimal restoration. China is also deemed to be doing better in recent years, but it still does not exude complete confidence in having achieved a sustained level for its economy.
China's debt situation does not exhibit confidence by the rating agencies who retain an element of doubt regarding the country's debt situation. The world's top credit rating agencies surmise that China's extended period of credit growth has in all likelihood added to China's economic and financial risks.
Indeed it is now several years since several economists, the International Monetary Fund (IMF), sundry investors and indeed the Poss of China's central bank has reportedly been cautioning that China's credit level is quite worrisome.
Even though recent reports indicate that the competent authorities have begun to crack down on large borrowing by the big companies this year, but top most credit rating companies like Standard and Poor's believe that credit growth in leading Chinese companies will remain at high levels which will most likely increase the financial risks gradually. Thus leading credit rating agencies like Moody's and Standard and Poor's cut China's credit ratings.
In the United States, Federal Reserve Chairman Janet Yellen recently presided over a meeting which reportedly decided last week to undo some of the steps it had taken since the Great Recession in 2008 to propel the economy. The central bank in the United States has decided to start unloading a part of the Dollars 4.5 trillions in investments beginning next month This denotes that officials of the Federal Reserve have the confidence that the American economy will continue to grow.
The Federal Reserve has thus indicated that beginning in October, 2017, it will start to unload Dollars 10 billion of debt from what it calls its balance sheet. Janet Yellen also indicated that the Federal Reserve will hold benchmark interest rates steady, and indicated a rate increase by the end of 2017. As a result of these steps, she said that long-term borrowing costs could thus rise modestly. The Federal Reserve thus stated that the job gains have remained solid and the unemployment rates have remained low. Furthermore, it was stated that though Hurricanes Harvey, Irma and Maria would hold back the economy for the time being, the storms would not alter the country's economy.
On its part, the Organisation for Economic Cooperation and Development (OECD) has stated that "the rebound in global growth is not yet secure with weak investment in business and slow growth in trade and wages raising doubt whether the current momentum will be maintained.
Copyright Business Recorder, 2017