KARACHI: Once again the cotton cultivation area has dropped sharply in both the cotton-producing provinces, creating fear of a major decline in production, which has pushed up the initial cotton trading price to an 11-year high.

Cotton traders and ginners are sure that the country would not achieve the target of 10.5 million bales set for this season which has just started. The previous season, which ended in March 2021, could hardly produce 5.6m bales against the target of 11m bales set by the government.

If the estimates of ginners and traders, who are in touch with the farmers, prove correct, the country would have to import cotton worth $2 billion to $3bn. This huge import would practically neutralise the impact of higher textile exports which have the support of the government and the State Bank.

“The reports reaching here from Punjab and Sindh show that the area of cultivation has been reduced by more than 20 per cent which means we can’t reach the production target of 10.5m bales this year,” chairman of the Pakistan Cotton Ginners Association Dr Jasomal told Dawn on Saturday.

He said the area under cultivation in Punjab had dropped to 3.2m acres against the target of 4m acres while in Sindh the area was not more than 1.2m acres against the target of 1.6m acres.

He said one-third of the ginning mills had remained closed during the previous years due to very low cotton production. Out of 1,300 ginning mills only 442 were fully or partially functional, Dr Jasomal added.

“The fear of shortage has already increased cotton prices in local market. The highest price — Rs14,000 per bale — was witnessed on Thursday which is 11-year high,” said Nasim Usman, chairman of the Karachi Cotton Brokers Forum.

Cotton has begun to arrive in market from Sindh while Punjab is still in sowing stage.

He said the local cotton prices were much higher than the international prices, creating space for more cotton import this year that would cost heavily to a country struggling to reduce trade deficit.

The recovery of Indian textile sector is visible from cotton import by India from the US. India has imported 42,300 bales of US cotton this year so far which means Pakistani textile exporters, who enjoyed free space in the absence of India due to Covid-19 and succeeded in booking large orders, would face tough competition in next few months.

Farmers in many areas of Punjab and Sindh have shifted or partially shifted to other crops, mostly to maize.

Dr Jasomal said that in many areas of the two provinces farmers had started sowing maize, sugarcane, rice and other crops instead of cotton.

“Since farmers can get three crops of maize in a single year, it is the most attractive crop for them as they earn much better income,” he said.

“If weather supports cotton cultivation this year, the production could reach around 7.5m bales despite low cultivation,” he said, adding that last year untimely heavy rain was the biggest reason for poor cotton production.

Published in Dawn, June 6th, 2021