KARACHI, Dec 3: A huge gap between demand and supply is likely to stay because cotton crop harvesting is still short up to 14.17 per cent at 10.240 million bales as against 11.930 million during the corresponding period last year.

The phutti (seed cotton) arrival during the last fortnight (Dec 15 to Jan 1, 2011) remained slightly better at 863,103 bales over the same period last year when production stood at 639,645 bales. It is, however, difficult that the gap could be narrowed substantially during the third and last picking, cotton analysts said.

The economy battered by war against terrorism is likely to have another beating if import of huge quantity of raw cotton between three to four million bales worth millions of dollars has to be made, they added.

Already, world cotton outlook is quite grim where prices surged to unprecedented high level owing to large scale involvement of fund managers and strong demand from China.The neighbouring India after indirectly imposing ban on raw cotton export has recently fixed ceiling on cotton yarn exports to stabilise prices in the domestic market.

However, Pakistani spinners are in a fix after Indian exporters refused to fulfill their export commitments of up to one million bales as the Indian government suddenly stopped export registration.

According to official figures, the country has produced around 10.240 million bales up to Jan 1, 2011, as compared to 11.930 million bales recorded last year.

Consequently, the crop is short by 14.17 per cent or by 1.7 million bales. Total domestic demand is at 15 million bales.

Cotton production in the Punjab remained short by 14.61 per cent at 6.751 million bales as against 7.905 million bales in the same period last year.

The province produced 1.155 million less bales against the corresponding period last year.

Similarly, cotton production in Sindh also remained short up to 13.31 per cent at 3.489 million bales as against 4.025 million bales recorded in the same period last year. This means that the province has produced 535,772 bales less so far this year.

The spinners purchased less cotton at 8.637 million bales compared to 9.946 million bales lifted by them in the same period last year. Similar is the case with exporters who also could not purchase 428,000 bales down from 717,809 bales of last year.

The unsold stocks with ginners almost remained close to last year at 1.175 million bales as compared to 1.266 million bales. However, during the out-going fortnight (Dec 15 to Jan 1) 223,458 more bales of phutti reached ginneries.

It is encouraging that higher number of ginning units continues to operate in Sindh and the Punjab with a total at 946 units against 658 units last year. In Sindh 215 ginning units are still active and in the Punjab 731 units are operating.