Report Highlights:
With expectations for no change in area, and assuming average yields, cotton production is forecast to decline in 2024/25.
Given prospects for an increase in cotton textile exports, domestic use is forecast to increase in 2024/25. As a result of the expected lower domestic production and higher domestic use, imports are forecast to increase marginally during 2024/25.
High energy and finance costs will continue to constrain the textile sector’s growth through 2024/25.
Executive Summary
With expectations for no change in area and based on five-year average yield of 598 KG/HA (excluding the flood-affected 2022/23 yield), production is forecast to reach 6.59 million bales. Export demand for Pakistan’s textile products is expected to increase modestly in 2024/25. The textile sector faces many challenges, but with expectations of slightly enhanced export demand, cotton use during 2024/25 is expected to increase marginally to 9.8 million bales. Nonetheless, use is still forecast to remain well below the previous 10-year average and the peak of 10.9 million bales in 2020/21.
With the expected decrease in domestic production, and only a small increase in use, imports in 2024/25 are forecast to be 3.2 million bales, slightly higher than in 2023/24.
In the first six months of 2023/24, the textile sector struggled due to sluggish export demand and high finance and energy costs. However, textile exports rebounded during first two months of 2024. Total export value in February 2024 was 20 percent above February 2023. The slowdown in domestic textile output during the first six months was reflected in the slow pace of cotton imports, which declined 65 percent through the first 6 months of 2023/24.
Source: USDA-FAS