Pakistan’s 2017/18 cotton production seen higher

Cotton production in Pakistan in MY 2017/18 (August-July) is now expected to be 9.2 million 480 lb bales, up slightly from the previous estimate, but there are expectations that poor arrivals could stymie the growth.

The Cotton Crop Assessment Committee (CCAC) in its meeting last month assessed cotton production at 12.6 million 170 kg bales (9.8 million 480 lb bales), but there is strong industry consensus that the final production estimate will be lower, given the pace of arrivals, and the CCAC meeting is expected to revise its final estimate at its next meeting in early 2018, the U.S. Agriculture Department (USDA) said in a report.

It said farmers in Pakistan appear to have taken advantage of a $625 million support package that provided fertilizer subsidies, reduced electricity rates for tube well pumps, reduced interest rates, and lessened the sales tax.

“Higher cotton prices also helped to encourage better crop management. Seed cotton prices have strengthened during the season. Prices for seed cotton are now 40 cents per pound, compared to 37 cents per pound a year ago. Higher prices are expected to prompt farmers to extend pickings late into the season,” it said.

Cotton Arrivals Close to Seven Million Bales:

Cotton arrivals as of November 15, 2017 reached 6.7 million 480 lbs. bales as reported by the Pakistan Cotton Ginner Association (PCGA), 7 percent ahead of the year ago pace. Arrivals appear to be on pace to reach 9.2 million 480 lbs. bales.

Trade Levels Meeting Expectations:

MY 2016/17 imports are estimated at 2.4 million 480 lb bales based on official Pakistani import data and export data from major suppliers. With the suspension of cotton imports from India in June 2017 due to reported phytosanitary concerns, imports from the United States have increased.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He also advises companies on thought leadership imperatives.

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