Cotton

Water shortage hits cotton production

ISLAMABAD (May 04 2008): Water shortage in Muzzafargarh Canal catchment area has affected cotton cultivation reducing the production ratio against the target of 14.11 million bales set for 2008-09. According to the sources, Muzzafargarh canal, the distributory of River Chanab, provides irrigation water mainly to the Cotton Belt of Southern Punjab.

'Extreme water scarcity in the canal for the last one and a half month has damaged the peak season crops can result in lesser production ratio during 2008-09', sources said. This situation draws attention to the fact that agricultural has taken a downturn in absence of dam construction posing threat to the country's agro-based economy.

According to an estimate, the water shortage may increase further to 22 percent during the year 2008 as compared to the last year. It has also been figured out that the cultivable land of around 22 million acres remains uncultivated due to water crisis.

The country needs to set up new water reservoirs on an urgent basis, in view of its dearth of water in the near future. As per different statistics, Pakistan is considered to be among 17 countries, those are currently facing severe water shortage and its reservoirs level may drastically decrease by 2025.

However, provincial favouritism and political differences have made the politicians to ponder upon their self-interest rather than that of national values, as for more than the last 45 years, not even a single mega reservoir has been constructed in Pakistan.

CNCE softer after holiday (3:47 GMT 4th May, 2008)
Grower sales rise on The Seam, as trade side falters (22:24 GMT 2nd May, 2008)
Most New York futures ended on positive ground (19:52 GMT 2nd May, 2008)
No. 2 cotton futures mostly higher at midday (16:53 GMT 2nd May, 2008)
Stormy weather forecast for southern US cotton growing areas (14:49 GMT 2nd May, 2008)
Asian mill buying quickens following drop in New York (11:34 GMT 2nd May, 2008)
Zimbabwe's main harvest period imminent (8:57 GMT 2nd May, 2008)
Business sales pick up on The Seam (21:09 GMT 1st May, 2008)
ICE cotton futures make sharp move lower (19:30 GMT 1st May, 2008)
ICE cotton futures trading lower (16:32 GMT 1st May, 2008)
Windy, slightly cool weather reported from Far Western US to West Texas (12:56 GMT 1st May, 2008)

Cotton lint at record high in north
3 May 2008 1:23 pm

Abohar - Spot cotton lint prices jumped higher to touch the season's high at the spot markets across north India Saturday. At Bhiki, cotton lint traded at record high of Rs 2,500/maund. Traders say, fresh arrivals have almost stopped and the stock available in the market is negligible. Therefore, the needy millers are buying at the market price for fuflfilling their requirement.

Meanwhile, world cotton mill use is projected to remain stable at 26.7 million tons in 2008-09 amid slower world economic growth and higher prices of cotton relative to polyester, the International Cotton Advisory Committee said Thursday in a press release. Global cotton production is expected to remain near unchanged at 26.2 million tons in 2008-09, up slightly from 26.18 million the previous year.

World ending stocks are projected lower at 11.4 million tons in 2008-09 from 11.9 million tons the previous year. Despite stagnant consumption, world exports are expected to increase to 8.6 million tons from 8.13 million tons due to higher expected imports by China, ICAC said.

Across Punjab, cotton lint traded at Rs 2,470-Rs 2,475/maund at Fazilka, Kotakpura, Muktasar and Bathinda; Rs 2,470-Rs 2,475/maund at Malot and Gidarbha; Rs 2,460-Rs 2,465/maund at Abohar; Rs 2,440-Rs 2,445/maund at Manasa; and at Rs 2,490-Rs 2,495/maund at Rampura, Barnala and Budhaldha.

Cotton lint traded at Rs 2,300-Rs 2,370/maund in Haryana and at Rs 2,180-Rs 2,300/maund in Rajasthan.

World cotton mill use static: ICAC
3 May 2008 12:36 pm

New York - World cotton mill use is projected to remain stable at 26.7 million tons in 2008-09 amid slower world economic growth and higher prices of cotton relative to polyester, the International Cotton Advisory Committee said Thursday in a press release.

Global cotton production is expected to remain near unchanged at 26.2 million tons in 2008-09, up slightly from 26.18 million the previous year, according to the release. Significant declines in production expected in the U.S. and Brazil could be offset by increases projected in Asia, West Africa and Australia, ICAC said.

World ending stocks are projected lower at 11.4 million tons in 2008-09 from 11.9 million tons the previous year. Despite stagnant consumption, world exports are expected to increase to 8.6 million tons from 8.13 million tons due to higher expected imports by China, ICAC said.

The Secretariat, using the ICAC Price Model 2007 forecasts a season-average Cotlook A Index of 77 cents per pound in 2008-09, 4 cents higher than the average expected in 2007-08, the press release stated. The 95% confidence interval is between 64 and 90 cents per pound.

WORLD COTTON SUPPLY AND DISTRIBUTION
2006/07 2007/08 2008/09 2006/07 2007/08 2008/09
Million Tons Million Bales
Production 26.67 26.18 26.2 122.5 120.2 120
Consumption 26.70 26.71 26.7 122.6 122.7 123
Exports 8.12 8.13 8.6 37.3 37.3 39
Ending Stocks 12.42 11.90 11.4 57.1 54.6 52
Stocks Adjustment -0.02 0.0 0.0 -0.1 0.0 0
Cotlook A Index * 59.15 73** 77*** 59.15 73** 77***
* Season-average Cotlook A Index (U.S. cents per pound). ** The price projection for 2007/08 represents the Secretariat
judgment, based on the average price for the first nine months and projected price variations during the rest of the season.
*** The price projection for 2008/09 is based on the ending stocks/consumption ratio in the world excluding China in 2006/07,
in 2007/08 (estimate), and in 2008/09 (projection), and on the ending stocks/consumption ratio in China in 2006/07 and in
2007/08 (estimate). 95% confidence interval: 64 to 90 cents per pound.

LATEST RAW COTTON ARRIVALS
(Position as on 03rd (May 2008)
The per day arrivals are reported around 40,000 bales.

States 2007-08 2006-07
Quantity in lakh bales of 170 kgs

Punjab 21.30 23.75
Haryana 15.00 14.25
Rajasthan 9.00 8.00
North Total 45.30 46.00
Gujarat 106.50 89.00
Maharashtra 59.25 49.50
Madhya Pradesh 19.75 17.00
Central Total 185.50 155.50
Andhra Pradesh 42.70 32.00
Karnataka 6.90 5.30
Tamil Nadu 2.80 2.80
South Total 52.40 40.10
Others 1.90 1.00
Total 285.10 242.60
Plus Loose lint 11.70 11.25
Grand Total 296.80 253.85

Rising dollar rates push cotton price up, may help exports

KARACHI (May 07 2008): Continued unpredictable fluctuations in the dollar rates pushed the prices up on the cotton market on Tuesday on expectations of improvement in the exports volume, brokers said. The Karachi Cotton Association (KCA) official spot rate was unchanged at Rs 3350.

Rising oil prices the world over and surging trend in dollar's value versus the rupee is raising hopes that country's exports may be friendly and might show significant increase during the last session of the current fiscal year, they said.

As a result, a deal at Khanpur finalised at the current season's high level at Rs 3700, they said. Some brokers were of the view that prevailing situation is likely to help the spinners in achieving their desired goals as ginners, who have unsold stock will try sell it even at lower rates. But a few of them were not ready to sell below their psychological level.

Dominating trend on the New York cotton market will lead them to formulate their future strategy, they said. On Monday, the NY cotton futures ended with small losses on investors' sales, as a result the ICE Futures' July cotton contract fell 0.27 cent to close at 69.29 cents per lb, trading from 69.05 to 70.30 cents. It was an inside day since the range was within Friday's 68.77 to 70.40 cents band. The new-crop December cotton contract shed 0.33 cent to 77.51 cents, dealing from 77.27 to 78.47 cents. Volume traded in the July contract at 2:58 pm (1858 GMT) was at 4,611 lots while December's tally was at 1,120 lots.

The following deals were reported as some 2200 bales of cotton from Khipro sold at Rs 3400, 1000 bales from upper Sindh at Rs 3350-3400 and 2200 bales from Khanpur at Rs 3700, they added.

================================================== =========
The KCA Official Spot Rate for Local Dealings in Pak Rupees
-----------------------------------------------------------
FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
================================================== =========
Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
================================================== =========
37.32 Kgs 3350.00 50 3400.00
Equivalent-------------------------------------------------
40 Kgs 3590.00 50 3640.00
================================================== =========

Cotton growing areas facing water shortage

LAHORE (May 07 2008): The cotton growing areas of Punjab and Sindh are facing acute water shortage for the sowing of cotton crop which is the backbone of country's economy. Wapda officials told Business Recorder here on Tuesday that there was at least 40 percent less water flowing in the four main rivers of the country these days as compared to the last year.

INFLOWS, OUTFLOWS OF RIVERS: They said in May 2007 the combined river inflows in the Indus, Jhelum, Kabul and Chenab rivers were nearly 250,000 cusecs in addition to sufficient live storage of water in three reservoirs, Tarbela Dam, Mangla Dam and Chashma Barrage. They said that the position of the river inflows/outflows at Tarbela, Mangla and Chashma along with the reservoirs levels and the barrages on Tuesday was as under:

RIVERS: Indus at Tarbela-inflows 54,100 cusecs and outflows 58,200 cusecs, Kabul at Nowshera: inflows 34,700 cusecs and outflows 34,700 cusecs, Chashma: inflows 74,200 cusecs and outflows 65,000 cusecs, Jhelum at Mangla: inflows 46,100 cusecs and outflows 35,000 cusecs, Chenab at Marala: inflows 26,500 cusecs and outflows 14,800 cusecs.

WATER STORAGE POSITION AT BARRAGES ON RIVER INDUS: Jinnah: inflows 79,400 cusecs and outflows 75,400 cusecs, Chashma: inflows 74,200 cusecs and outflows 75,000 cusecs, Taunsa: inflows 50,800 cusecs and outflows 45,900 cusecs, Guddu: Inflows 37,200 cusecs and outflows 37,200 cusecs, Sukkur: inflows 31,700 cusecs and outflows 8,100 cusecs, Kotri: inflows 4,630 cusecs and outflows mil.

RESERVOIRS LEVEL AND STORAGE: Tarbela: level 1,369.00 feet, and dead level 1,369 feet (live storage zero) Mangla: level 1,090.60 feet, live storage 0.448 MAF and dead level 1,040 feet, Chashma: level 638,90 feet, live storage 0.022 MAF and dead level 637 feet.

Growers have complained that presently there was irrigation water shortage ranging from 30 to 70 percent in the cotton growing areas of southern Punjab and due to long load shedding hours, they could not operate their tube-wells.

Business sales slip, but Grower activity returns to The Seam (21:10 GMT 6th May, 2008)
New York cotton closes with sharp gains (19:28 GMT 6th May, 2008)
ICE cotton futures trading on strong gains (16:32 GMT 6th May, 2008)
Planting expanding in Pakistan (13:04 GMT 6th May, 2008)
Stormy weather reported in West Texas (13:02 GMT 6th May, 2008)
ZCE prices weaken on balance (12:44 GMT 6th May, 2008)
California cotton planting near complete (12:22 GMT 6th May, 2008)
Indian seed cotton arrivals (10:01 GMT 6th May, 2008)
New York futures: spec/hedge report (9:43 GMT 6th May, 2008)
Pakistan final 2007/08 seed cotton arrivals report (9:08 GMT 6th May, 2008)
China Cotton Index (5:13 GMT 6th May, 2008)

Spun Yarn Prices in India (Monthly Report)

27 April 2008 - Cotton yarn prices started rising in April in India after cotton prices dramatically increased in the past six months. Yarn processors are more easily accepting higher prices while yarn exports are slowly recovering. Activity however remains too low for spinners who continue suffering from higher raw material costs.

Textile exports may cross USD 40bn in 2010/11"

Mumbai, May 08: India's textile exports may cross $40 billion in 2010/11, short of the government's stated target of $50 billion, weighed down by the rise in rupee over the past year, ShankerSinh Vaghela, Union Minister of Textiles said.

The government is targeting textile exports of around $25 billion for 2008-09, Vaghela told in an interview late Wednesday. India missed its 2007/08 target by 18 percent due to the rupee appreciation.

"I understand that our $50 billion target is facing some challenges, but we are still confident of achieving more than $40 billion", Vaghela, who spoke in Hindi, said.

"A strengthening currency is good for any country. However our exports were hurt as exporters did not get the desired returns", he added. However, the worst is behind and exports will benefit now that the rupee has started falling again, he said.

Cotton production is also set to accelerate in the year ending September 2009 mainly due to an increase in productivity in Maharashtra and may cross 35 million bales, he added.

Production in 2007/08 is estimated at 31 million bales. One bale is equivalent to 170 kilogrammes. The Indian rupee rose over 8 percent against the dollar between April 2007 and March 2008, making it one of Asia's best performing currencies. A stronger rupee hurts exports by making local goods expensive in overseas markets.

It lost 3.9 percent in the financial year that began April 1.