KARACHI (May 27 2010): Despite a massive shortage in the domestic market, the country's raw cotton export registered a robust increase of 140 percent during the first 10 months of current fiscal year mainly due to rising demand in the world market. Industry sources told Business Recorder on Wednesday that Pakistani exporters are getting massive orders on the back of high production and low prices in the domestic market as compared to other countries.
As per world cotton estimates, all major cotton producers including China are facing short cotton crop this year, therefore, cotton demand in the world market is increasing gradually and recently India imposed some 2.75 percent duty on the export of raw cotton to curb rising export of the commodity.
Pakistan achieved a bumper crop during the current cotton season and overall cotton production stood at 12.7 million bales during current fiscal year (2009-10) as compared to 11.2 million bales in last fiscal year 2008-09, depicting an increase of 1.5 million bales. Although, the country has got a bumper cotton crop, however it is much less than the consumption and not sufficient to meet the country's demand, which presently stood at some 15.5-16 million bales per annum.
Recently, the value added textile sector also demanded of the government to slap ban on the export of raw cotton, as local prices of cotton yarn are moving up due to short supply of raw cotton. However, local exporters are taking full advantage of free trade regime, as there is no restriction on the import and export of raw cotton due to the free economy under the WTO agreement.
According to the Federal Bureau of Statistics (FBS), the country's cotton export posted an increase of 140 percent during the first 10 months (July-April) of current fiscal year. The country exported worth $194.154 million raw cotton in July-April as compared to $80.835 million during the corresponding period of FY09, depicting an increase of $113.319 million.
Meanwhile, month on month basis cotton export also surged by 20 percent to $1.12 million during April 2010 as compared to $0.645 million during the same period of last fiscal year. "At present Pakistani exporters and traders are being offered lowest cotton price in the region as compared to other competitors, with the result they are getting massive export orders," said an exporter.
He said Pakistani raw cotton exporters are offering better quality cotton at reasonable price of some 80 cents per maund as compared to some 84-86 cents per maund by the Indian traders, while expected bumper crop in the upcoming season has also put a positive impact on the export of cotton. "We are expecting record export of raw cotton next fiscal year," he added.