Reliance on cotton import grows as government fails to set phutti price
The country’s reliance on import of cotton has increased due to failure of the government to announce proposed indicative price for phutti (seed-cotton) at Rs 4,000 per 40-kg and substantial decline in cotton production as opposed to last year, leave alone the set target for the current fiscal year.
Sources said that a committee led by Advisor on Textile, Razak Dawood remained indecisive to announce Rs 4,000 support price for cotton suggested by the Ministry of National Food, Security and Research to the Economic Coordinating Committee (ECC) of the Cabinet to support the farmers against higher input cost after having a series of meetings with the stakeholders. An official maintained that Rs 4,000 support price was proposed on the basis of Rs 3,600 cost of production of the commodity.
The ECC decided to constitute a price review committee under the chairmanship of the advisor on textile; however, the committee could not come up with the conclusion to announce the indicative price despite holding two meetings. The Ministry of National Food Security and Research maintained that the cotton price remained less than Rs 4,000 per 40-kg during the last ten consecutive weeks, the sources added.
The meetings of cotton growers and other stakeholder were held with the advisors on finance and textile in the first week of September and discussion on indicative price of cotton was held. The government has set the target of 15 million bales of the cotton, which was revised downward to 10.6 million bales and background interaction with the officials reveals that cotton production may not be more that 9 million bales as recent cotton arrival figures suggest a 35 percent reduction in cotton arrival from the last year’s in Punjab and 18% reduction in Sindh.
When contacted, President Kissan Ittehad Khalid Khokhar concurred that cotton production in Punjab may not go beyond 5.5 million bales as opposed to 6.6 billion bales for the last year and the cotton arrival figures suggest that there may be a shortage of 16 to 17 percent in cotton production in Sindh which means that total cotton production, he added, may not be over 8.5 million bales.
He said that despite recommendations made by the National Assembly Special Committee on Agriculture, chaired by Speaker National Assembly on April 24, 2019, and a resolution passed by the National Assembly on April 30, 2019 regarding early announcement of support price, nothing has been done.
He said that cotton growers will face a loss of Rs 35,000 to Rs 40,000 per acre due to recent rains as well as higher cost of production, which may discourage the growers to produce cotton crop in the next season.
The proposal was not agreed by the Advisor on Commerce and Textile, Razak Dawood for unknown reason and the country may have to import 4 million bales to meet the demand.
He added, “We have repeatedly informed the government and committee that cotton prices have been below the cost of production since June 2019 and if support price was not announced, the grower would not be able to afford pesticide sprays and fertilizers and consequently the size of the crop would contract. However, the farmers’ request remained unheard and cotton support price was not announced.”