This season some 0.3 million bales equivalent of Sindh seed cotton has been transported to Punjab ginneries which when included, Sindh crop may be around 4.5 million bales. Punjab province may produce 8.7 million running bales in 2009-10 against 8.354 million bales produced last season - increase 0.35 million bales (4.20 percent). District-wise, Sanghar in Sindh has emerged as top producer around 1.9 million bales, about 45 percent of whole Sindh and 15 percent of whole of Pakistan. Sanghar district has increased its cotton production from 1.322 million bales in 2008-09 season to 1.9 million bales in 2009-10 season - increase is 0.578 million bales = 43.72 percent.
Next season, Sindh may easily produced some 5.5 million bales on increased yield and area and thus continue increasing its share in national crop. The concerned agriculture departments - organisations should evolve their own Bt cotton-seed varieties suiting different soil / climates of various zones in Pakistan so that we may increase our cotton production by obtaining higher yields. Reportedly, the Government of Pakistan have signed some memorandums of understanding (MoUs) with one Chinese company and Monsanto Co and the latest position in respect of the developments in evolving Bt seed be known to general public particularly the farming community.
In next five years, Pakistan should attain self-sufficiency in cotton and should increase its production to 18.0 million 170-Kg bales to meet its domestic requirements by attaining lint yield of Kgs 875 a hectare. It is not a difficult target if serious efforts are made. Our economy largely depend on exports of textile goods and we should be at least self sufficient in our cotton requirements so that we may not waste our foreign exchange earnings on costly import of cotton.
This season, we may export some 0.8 to 0.9 million bales at estimated average export price of US Cents 60.0/lb and our average import prices may be not be less than US Cents 75.0 /lb on some 3.0 million 170-Kg bales. We may spend US $1 billion on cotton imports as we did in 2005-07 season. If we spend half of US $1 billion at the rate of Rs 12,000 per hectare of cotton area on promotion and adoption of latest irrigation, seed development and other technologies, we may increase our cotton production by 2.0 million bales every year to 23.0 million 170-Kg bales in next five years and become surplus in cotton production. Being an agriculture countries largely depending on exports of cotton and cotton products, Pakistan has to have its own cotton production at least matching with its domestic requirements and it should be given top priority for strengthening its economy.
In this season, cotton prices took start from Rs 3,300 per maund of 37.324 Kg ex-gin from Sindh in July, 09 and culminated to Rs 4,800 in late December,09. In six month's period, lint prices increased by more than 45 percent more on foreign than local factors. The globally rising trend in prices of major commodities such as gold, silver, crude oil, edible oil and agriculture commodities and declining strength of US currency against other major currencies sparked prices of lint cotton, yarn and textile products in local as well as export markets. The huge shortage of some 1.5 million 480-lb bales of raw cotton in China further fuelled prices of cotton, cotton yarn and textile products in its neighbouring countries like India, Pakistan, Indonesia and Bangladesh. As a result of unabated exports of raw cotton, cotton yarn and cloth more particularly to China, domestic weaving, knitting and towel manufacturing industries and cloth / garment industries are facing great difficulty on availability of their raw material at reasonable price.
On great persuasions, demonstrations and protests by these value addition industries, the government was obliged to cap the monthly export of cotton yarn to 50,000 m/tons for six months from January to June,10. Recently, some weakness in cotton, yarn and cloth prices have been seen. The Heimtextil exhibition in Germany which ended last Saturday was reportedly largely attended by Pakistan's textile entrepreneurs and sufficient orders for supply of textile goods have been secured but at prices lower than expected. The acute shortage of power (electricity and gas both) industries specially the power loom and textile sectors in Pakistan, particularly in Punjab and Sarhad provinces have virtually crippled rendering a great number of workers jobless.
The performance of our economy in first six months period (July - December,09) has been found below desired level. During these six months, total exports stood at US dollars 9.181 billions against 9.474 billions same period last year and imports were at USD 15.994 billions against 19.117 billions same period last year. The good news is that in last six month, Pakistan's exports decreased by 3 percent while imports decreased by 16.33 percent which reduced our trade deficit from US 9.643 billions to 6.803 billions. The amount of foreign home remittances is also increasing and the government has fixed target for FY 2009-10 at US $1 billion per month.
Lint prices in the local market have showed weakness and are now quoting between Rs 4,500 to 4,650 per maund ex-gin. The exporters are on the sidelines waiting further fall in prices to match it with export prices. Prices on New York Future market have also dropped to 72.08 and 73.19 both March and May contracts respectively. Previously, the market was expected to touch the level of 80 but now it appears difficult. The instability in political, economic, safety and security and law and order situation should improve to give free breathing space to business conditions failing which the economic conditions may further deteriorate creating other serious problems for the country.