Right time to fix cotton price

cotton-price-in-pakistan

November 10th, 2014 – Mohammad Hussain Khan –

While the cotton-picking season is not far from its end in Sindh, the Trading Corporation of Pakistan has yet to lift lint cotton from ginning factories.

It has been over a month since the Economic Coordination Committee (ECC) had announced procurement of 1m bales from cotton ginners to stabilise prices, while approving the support price of Rs3,000 for seed cotton.

However, procurement centres have not opened yet to lift cotton bales from ginners, though reports indicate that they are to be set up in Sukkur, Nawabshah and Mirpurkhas districts.

The Trading Corporation of Pakistan is now busy finalising modalities to lift lint cotton from ginning factories. A meeting between TCP officials and ginners was held last Thursday. The TCP administration indicated it would buy 600 bales from each factory against the demand of 20,000 bales by Pakistan Cotton Ginners Association.

‘If the government decides to procure cotton, it should finalise its policy by May or June when the crop is ready for picking’
A former PCGA chairman for Sindh Ramesh Lal said the TCP is moving cautiously because of its past experience and the early crop growers of lower Sindh will not benefit from the delayed decision. Only farmers of upper Sindh and Punjab will get the advantage of support price.

He said about 8.4m cotton bales are recorded to have arrived at ginning factories, against 7.6m bales last year. Figures indicate that around 14-15m bales will be produced in the country, with Sindh’s output slated to be 3.5-4m bales.

The prices of cotton crop now vary between Rs1,800-2,000 per 40kg in lower Sindh, but ginners like Lal insist that the crop in lower Sindh’s has been hit by pink bollworm, which has affected its price. However, growers reject his claim and assert that unjustified deductions are made from their payments. Lal claims that a price of Rs2,500 per 40kg is being offered to producers in upper Sindh.

Currently, around 80-90pc of the crop in lower Sindh has been sold in the market as the growers prepare for sowing wheat. In upper Sindh, seed cotton is reaching ginning factories now, given the late sowing across the country.

According to PCGA estimates, another 7m bales are to be produced as per the target. Reports also indicate that the TCP will buy the best quality of cotton.

For a long time, cotton growers have been anticipating a decline in the crop’s acreage and yields, and have urged the Sindh government to pay serious attention to the issue. They attribute the drop in acreage to the price factor, non-availability of water and increasing cultivation of sugarcane and paddy crops in cotton-exclusive areas.

The Sindh agriculture department’s figures show that cotton-sowing targets have not been met from 2008-09 to 2013-14, barring the 2009-10 season when the province came up with 4.2m bales out of 634,714 hectares on which the crop was cultivated.

“If the government decides to procure cotton, it should finalise its policy by May or June, when the crop is ready for picking. But our cries fall on deaf ears. We have been saying that cotton is facing serious issues, but no one is listening and no one is even ready to ensure that paddy or sugarcane is not cultivated where its sowing is banned, i.e. in the cotton-exclusive zone,” lamented Mahmood Nawaz Shah.(Dawn)

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