From the Secretariat For Release August 17, 2010

Pakistan is the fourth largest cotton producing country. Pakistan was
expected to grow 2.2 million tons in 2010/11, the first year of the official
release of biotech cotton in the country.

Many cotton districts in the provinces of Punjab and Sindh have been severely
hit by floods, and more rains are forecast over the next week. The provincial
governments cannot make objective estimates of losses until the rains stop
and flood water recedes. Nevertheless, best guesses are that 6-8% of the
total cotton area has been lost entirely.

Additional losses will occur as a result of the excessive moisture. Standing
water suffocates the root system and kills cotton plants. However, the crop
in Pakistan has reached the peak flowering/fruit formation stage in the
Punjab, the boll maturity stage in upper Sindh and early-planted areas of
Punjab, and the boll opening stage in lower Sindh. Consequently, cotton
plants have grown tall enough and have developed large enough root systems
that many will be able to survive the floods.

Hot and humid conditions provide suitable conditions for pest multiplication,
including bollworms that affect the fruit directly. The Secretariat estimates
that at least half of the 2010/11 crop was planted to biotech varieties
resistant to bollworms. Moreover, plants still have time to recover fruit
losses due to shedding. In addition, those areas of the Punjab that have been
safe from floods may produce high yields, thus partially offsetting losses in
other areas.

While considerable uncertainty remains, the Secretariat is revising its
estimate of the 2010/11 Pakistan crop down by 15% to 1.9 million tons. The
estimate of Pakistan mill use is being reduced by 100,000 tons, but estimates
of mill use in other countries are being raised to compensate, leaving world
mill use unchanged.