WEEKLY COTTON REVIEW: trading volume increases, rate remains stable
The rate of cotton remained stable. The trading volume increased. The sowing of crops of rice, corn and sugar cane on the area of cotton observed. The production of cotton is expected to be approximately one crore 25 lac bales.
The successful talks between cotton sector and Federal Board of Revenue (FBR) gained vague assurance of the government regarding abolishing of sales tax on Khal Banola which is used as animal food. The textile and spinning mills took interest in buying during the last week in the local cotton market due to which the rate of cotton remained stable.
The supply of Phutti is increasing and it is expected that trading volume will be increased in coming days. At the moment the number of ginning factories is increasing along with the increase in the supply of Phutti in Sindh and Punjab. Up till now the production of cotton crop is satisfactory in Sindh is satisfactory but the farmers of the areas of Umer Kot, Kunarri and Sammaro road are claiming that 40 percent of their crop is effected due to extreme hot weather. But we can say that over all position of crop of cotton is satisfactory in the country except few areas of Punjab.
According to agriculture minister Punjab Malik Noman Ahmad Langrial the sowing of cotton has completed in the province. It is expected that 80 lac bales will be produced in Punjab, while the production of cotton is expected to be in between 42 to 44 lac bales in Sindh. It is expected that production of cotton will be One and a half lac in Balochistan and Khyber Pakhtunkhwa. Overall production of cotton is expected to be approximately one crore 25 lac bales while according to the estimates of international news agency the production of cotton will be one crore 27 lac bales.
In Sindh the rate of cotton is in between Rs 8450 to 8500 per maund. The rate of Phutti is in between Rs 3700 to Rs 4100 per 40 Kg and the rate of Banola is in between Rs 1450 to Rs 1500 per maund.
In Punjab the rate of cotton is in between Rs 8550 to Rs 8600 per maund. The rate of Phutti is in between Rs 3700 to Rs 4200 per 40 Kg. The arrival of Phutti has started partially in Balochistan. The rate of Phutti is Rs 4000 to Rs 4100 per 40 Kg. The ginning factories have started their operations partially in Balochistan.
The Spot Rate Committee of Karachi Cotton Association has increased the spot rate price by Rs 100 per maund and closed it at Rs 8400 per maund.
Chairman Karachi Cotton Brokers Forum said that in the international cotton market the bearish trend was seen. In New York Cotton the Rate of Promise (Waday Ka Bhao) remained in between 6170 American Cent to 6270 Cent per pound which is lowest in three years. The reason behind low cotton prices in America is increase in the production of cotton and on the other hand the export of cotton is less than expectations.
There was no dealing of cotton between the biggest buyer of cotton in the world China and the biggest exporter of cotton America due to their longstanding trade conflict which is not going to be solved. The rate of cotton is stable in China white bearish trend was seen in India despite the president of Indian Cotton Association Atul S Ganatra said that production of cotton in India will be three crore twelve lac bales which is lowest in ten years. He requested the government that they should take steps to increase the production of cotton will effect the textile sector.
He told that industrial and business sector in the country was very much worried due to the imposition of sales tax. The business had suffered a lot due to imposition of sales tax. There is a panic among small and large business men and people due to imposition of taxes. Few days back business men observed complete strike against imposition of sales tax. The textile sector has suffered a lot. The textile processing sector has called off their seventeen days strike against imposition of seven teen percent sales taxes after negotiations with the government.
All Pakistan Textile Mills Association had given advertisements in newspapers against the imposition of seven teen percent sales taxes and abolition of zero rated status. The talks between APTMA and FBR chairman were not concluded successfully. Moreover, Prime Minister Imran Khan had called the representatives of APTMA, PCGA, KCA and office bearers of oil mills association last Wednesday. One of the representative told that due to the busy schedule of PM talks were held between chairman FBR Shabbar Zaidi and Jahangir Khan Tareen. They listen to the issues faced by these sectors and assured them that positive steps will be taken regarding solving their issues. Moreover, during the talks with chairman FBR Shabbar Zaidi assured that decision of imposition of sales tax on Banola will be taken back because it is the part of feed of animals but the representative of oil mills association said that it will take time because the matter will be presented in the cabinet. Moreover talks will be held in coming days on imposition of 10 percent sales tax on cotton and fixing the support price of Phutti. Ginners and oil mills owners had termed the talks satisfactory and called off the strike.