Cotton

Pakistan – is going through a difficult period of instability. The recent parliamentary elections have not
solved their political problems; to the contrary, a lot of uncertainty remains regarding
the political and
economic outlook. Consequently, the exchange parity of the Pakistani Rupee against the U.S. Dollar has
dropped sharply to around 70 Rs/1 Dollar (a depreciation of over 10% during the last several months).
Inflation and interest rates have also gone up sharply. There is a power shortage causing the whole
country to suffer, including daily power cuts of up to 6 hours. Financially weaker mills who cannot afford
to install their own generators are forced to reduce consumption or close down completely.
2007/08 crop final figures published by the Ginners’ Association amount to 11.35 million 170 kg bales
(8.83 in Punjab and 2.52 in Sindh) compared with 12.41 last season (10.09 / 2.32). There are only about
200,000 bales of present crop remaining unsold with ginners. Consumption is between 15-16 million
bales, slightly down from last season. Imports will amount to a minimum of 4 million bales and India has
become the main supplier of more than 50%. Price-wise, and logistically, the Indian varieties have had
an attractive advantage during the season. Due to a narrow difference between Upland and Long staple
varieties, there has been an increase in the use of Egyptian (mainly Giza 86) as well as U.S. Pima cotton.
New crop 2008/09 plantings are well under way and, contrary to earlier expectations, we could expect a
slight increase in area because farmers, who were happy with prices obtained last season, may switch
some acreage from sugarcane. Under normal growing conditions and good monsoon rains, a crop of up
to 13–14 million kg bales would be realistic. Unfortunately, Pakistan has not managed to increase the
yield in the fields during the last few years because of a lack of seed control and official ban of growing
BT varieties. Government authorities have recently made an agreement with Monsanto for the future use
of BT-seeds, which would only become an issue for the 2009/10 season, if everything goes well.
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India – Merchants are waiting on the sidelines for potential duty free imports originating from least
developed countries (LDC). Since its announcement by the Indian Prime Minister, mills are waiting for an
official notification by the Ministry of Commerce and Industry. Rumors have it that opposition is growing
to the announced import duty exception; if implemented it would be at the end of the year when cheap
cotton is available again. Currently, ginners hold roughly 2 million 170 kg bales and after recently firming
prices, they brought exports to a halt.

May 30, 2008

The bearish cotton fundamentals have finally embedded themselves within the activity of the New York futures market. The nearby July contract fell 150 points below the 68 cent level I felt would support prices. The slippage in July futures down to the 64-65 cent level took the market back to near the October 2007 lows. Therefore, since the October lows, price movement has experienced an unprecedented near 50 cent rise and subsequent fall. As a friend stated this week, “I would have sure hate to be a cotton merchant.” The new crop December contract did hold the 74-75 cent level, a support level than should continue to prop up the market. Likewise, this week’s July lows should also hold as excellent demand resurfaced once July slipped below 67 cents.

Textile mills have been somewhat estranged from the market for the past three weeks. The mill absence from the U.S. export market left net export sales during the week ending May 22, 2008 at only 110,600 RB. Upland sales totaled only 107,800 RB while Pima sales were 2,800 RB. China (29,200 RB); Thailand and Turkey were the primary buyers of Upland. India (2,500 RB); Pakistan and Japan were the primary buyers of Pima. Weekly export shipments continue to lag some 150-200,000 bales behind the pace necessary to meet the USDA projection of 14.2 million bales. Export shipments totaled 270,500 RB with Upland accounting for shipments of 258,800 RB, about the same for the third consecutive week. Pima shipments were 11,700 RB. Primary destinations of Upland were China (106,100 RB); Mexico and Indonesia. The primary destinations of Pima shipments were China (3,200 RB); Indonesia and Pakistan.

One reason for lagging shipments is the occurrence of difficulty in obtaining outbound ships as well as rapidly increasing shipping rates that has resulted from the energy crisis. There is little reason to see much improvement in that crisis. Thus, mills will continue to face inflated transportation costs.

This week’s lower prices did bring the international mill community back to the U.S. export market. Export sales should improve over the next month as mills have indicated their stocks are, in many instances, abnormally low. Sales, principally to China, but also to Turkey should improve dramatically in the coming weeks.

Another bearish overtone facing the cotton market was this week’s slippage in all commodity prices; agriculturals, financials and the metals. Too, the value of the U.S. dollar, rallying off record lows, is now in its third week of rallying. This, along with the increased shipping cost has made it difficult for U.S. growths to compete. However, the lower prices experienced will add to the demand base.

With certificated stocks near 1.6 million bales; with 2007-08 U.S. carryover above ten million bales; and with world carryover above sixty million, the market is stuck in a deep vat of mud and syrup. There is scant upside potential above 68-70 cents for the old crop July. December will trend higher, but only after the July expiry. Just as there is little upside potential for the July contract, there is little downside potential for the December contract.

pakistan cotton report

Pakistan"s 2008/09 cotton production forecast is 9.375 million (480 lb) bales, 6% above the current year"s arrivals registered as of May 1, according to a U.S. Department of Agriculture attache report posted Tuesday on the Foreign Agricultural Services Web site.

The GOP and Monsanto have signed a Letter of Intent for mutual collaboration in biotechnology. The initial focus is to expand cotton production in Pakistan. Severe power shortages and reduced water for irrigation are likely to impact cotton production and trade. Pakistan is a major cotton importer, especially for U.S. upland and Pima cotton. Consumption is forecast at 12.175 million (480 lb) bales, marginally lower than last year. Pakistani farmers are expected to plant about 50 percent of this year"s cotton crop in illegal Bt varieties.

Executive Summary
Pakistan"s MY 2008/09 cotton crop is forecast at 9.375 million (480 lb) bales - based on increased production, improved technology, and good management practices adopted by cotton growers. Strong demand from Pakistan"s textile industry is expected to consume 12.175 million (480 lb) bales of cotton. The Government of Pakistan (GOP) and Monsanto have signed a 'Letter of Intent' to initiate collaboration in biotechnology - an extremely favorable development for future commercialization of transgenic technology in Pakistan. Reduced availability of irrigation water, high fuel prices and daily power shortages are taking a toll on this year"s cotton production and trade. Progressive textile mills are focused on producing better-quality products, particularly for the export market. Consequently, Pakistan is a major cotton importer -- especially for U.S. upland and Pima cotton. In the face of dwindling local supplies, rising prices and continued contamination problems, local mills are finding the importation of upland cotton increasingly attractive.

Production
Pakistan"s MY 2008/09 cotton lint production is forecast at 9.375 million (480 lb) bales compared to the GOP"s final figure of 8.87 million bales registered with the ginning industry as of May 1, 2008. This production increase is mainly in response to better prices received by producers in MY 2007/08; average prices received were $ 600 per MT compared with last year"s average price of $ 480 per MT. Prices remained significantly above the indicative price fixed by the government. This year, acreage under cotton is projected to increase slightly over the preceding year as some sugarcane area was planted to cotton. Despite a bumper sugarcane crop, farmers are expected to divert acreage to cotton as sugarcane was purchased by millers at below the support price. MY 2008/09 cotton area is forecast at 3.05 million hectares, an increase of 2 percent over the previous year.

The production forecast assumes normal weather conditions and low pest infestation. This year, the cotton yield is forecast to be higher due to improved management practices, availability of better quality inputs and launching of a special media campaign. Pakistani farmers, inspired by increased cotton production in India and China, are keen to cultivate transgenic cotton varieties, especially in the core cotton-producing areas of Punjab and Sindh.

Pakistan"s cotton crop is planted from end-April through June and is harvested in the fall. Planting area and production strategy is influenced by a number of factors including crop prospects in the international market, relative prices of competing crops, input availability, weather forecast, and government policy. This year"s severe energy and electricity crises is likely to impact cotton production as operating costs have increased significantly.

The major threat to Pakistani cotton is the prevalence of mealy bugs and cotton leaf curl virus (CLCV). At present, there are no resistant varieties.

In a recent development, the GOP signed a 'Letter of Intent' with Monsanto for collaborative research and development in biotechnology. The initiative will start with cotton, followed by future collaboration on corn, oilseeds and other major crops. Local scientists and researchers have also focused on developing resistant varieties through traditional breeding, hybridization, and biotechnology.

Status of Bt Cotton
On May 13, 2008, the Ministry of Food, Agriculture and Livestock (MINFAL) signed a Letter of Intent (LOI) with Monsanto to initiate collaboration in the field of biotechnology. This landmark agreement provides an opportunity to expand cotton production through the commercialization of Bt technology in Pakistan. The LOI outlines a strategy to extend cooperation in advancing transgenic technology in Pakistan"s agricultural sector. Under the agreement, information and education regarding the safety and benefits of the technology will be provided to farmers. Also, assistance will be provided to develop business models and marketing services to meet the Pakistani cotton industry"s long-term strategy.

Pakistan"s Biosafety Guidelines and Rules were enacted in 2005, followed by the establishment of a National Biosafety Centre within the Ministry of Environment which has the capacity to evaluate any proposal submitted for GMO testing and approval. National institutions like the Center of Excellence in Molecular Biology (CEMB) and the National Institute for Biotechnology and Genetic Engineering (NIBGE) have submitted proposals to the National Biosafety Committee (NBC) for approval which are being evaluated.

This year, farmers are expected to plant about 50 percent of the crop in illegal transgenic varieties. This poses several serious problems. First, the pirated varieties are not developed for Pakistan"s agronomic conditions and do not always perform well, especially against mealy bugs and CLCV. Secondly, while farmers have no assurance that they are purchasing quality Bt seeds, they nonetheless reduce spraying - - raising the risk of increased pest damage, particularly later in the season. Raw material from unapproved Bt varieties results in reduced quality cotton which traders are reluctant to export.

Production Policy
Pakistan"s economy is heavily dependent on the cotton and textile sector - which accounts for 8.2 % of the value-added in agriculture and about 2 % to GDP. The country"s gross exports in 2006-07 were valued at about US$ 17 billion, of which US$ 9.978 billion (59%) were accrued through raw cotton and textile products. Hence, growth in the national economy is essentially linked with the volume and value of cotton produced in the country. Major components of the strategy to increase cotton production includes increased area, enhanced tonnage of certified seed of approved varieties, use of a higher seed rate, discouragement of late cotton sowing, increased plantings, subsidizing fertilizers, assured availability of quality and insect-specific pesticides - particularly for mealy bug and whitefly - and a focused media campaign.

The GOP announces the Minimum Support Price (MSP) for cotton at the start of each marketing season. The Trading Corporation of Pakistan (TCP) is responsible to intervene in the market if prices fall below the MSP. During the past two years, prices generally remained above the MSP - thus, the TCP did not intervene. For MY 2008/09, the previous year"s support price of Rs. 1025 per 40 Kg ($1 = Rs. 65) was left unchanged. Despite what turned out to be a good crop in MY 2007/08, initial uncertainty over the size of the crop proved sufficient to spur market speculation early in the year which, in turn, increased farm-gate prices. During the past two years, good returns on cotton production have encouraged farmers to use their

Mealy bug causes loss to cotton crop

FAISALABAD (June 01 2008): Agriculture scientists pointed out that since 2005 cotton crop has been infested with mealy bug, while in last season, CLCV and mealy bug incidences caused an estimated 16.4 percent loss (about 2.1 million bales) of the total production to the cotton crop during 2008.

According to official sources, this infestation has adversely impacted both the cotton yields and its quality. It requires an early attention of all stakeholders to take preventive measures to ward off this menace.

In Pakistan, 96-150 insect and mite pests attack cotton crop during its growth period, said agriculture scientists. Their damage results in destruction of a large number of flower buds (square), tender shoots tips and immature bolls (green bolls) which reduces the yield. Insect pests cause heavy qualitative and quantitative losses in cotton yield varying from 39-50 percent.

According to research reports, the pink hibiscus mealy bug (PHM) - Maconellicoccus hirsutus (Green) - is a serious new threat to Pakistan agriculture. It is a small insect 1/5th of an inch size, gets its name from its appearance. Mealy bugs over winter as eggs on stems, in soil, in cracks and crevices in the stem, and inside crumpled leaves.

Freshly laid eggs are orange but turn pink just prior to hatch. The crawlers disperse from the ovisac by way of walking, wind, or ants. The nymphs feed and develop into adults in approximately 30 days.

The insect has a life cycle of 24 to 30 days. The female mealy bug produces 10-15 generations per year in colonies of 500-600 eggs. It attacks more than 300-plant species world around, including Pakistan.

THESE ARE: rice, sugarcane, cotton, fruits; papaya, carambola, avocado, citrus, sugar-apple, mango breadfruit, golden apple, cherry, plum, guava, pigeon pea, passion fruit, grape, banana; vegetables, tomato, cucumber, pumpkin, peppers, okra, dasheen, lettuce cabbage, beans, squash; ornamentals hibiscus, bougainvillea, croton, oleander, allamanda, ixora, anthurium, ginger lily, heliconia, schefflera, lantana, ficus, seagrape, and numerous weeds etc.

Mealy bug also excretes large quantities of honeydew onto the plant that in turn attracts ants and sooty mould. Keep ants under control as they may distribute the pests to other plants.

Cotlook sets new forward cotton index

NEW YORK (June 01 2008): Influential industry analyst Cotlook said Friday it established a Forward (2008/09) A Index for cotton whose value was pegged at US 80.25 cents per lb. Cotlook publishes a cotton index that is closely followed by the cotton and textile trade.

In a statement, Cotlook said the new index "represents a premium of 7.50 cents over the current season's index value, the largest recorded premium for a Forward Index." It is the latest date at which a Forward Index has been established since the creation of the dual cotton index system in 1989.

"The delay is principally the result of the increased risk which the international trade confronts in hedging forward sales or purchases, following the extreme volatility experienced in the cotton futures market in early March," Cotlook said. The 2008/09 Index will run concurrently with the current season's index until July 31, at which time it will stand alone until a Forward 2009/10 Index is established sometime after the turn of the next year, it added.

Mali sees 2008/09 cotton crop rising 87 pct
[ICC News Desk 31/05/08]
BAGUINEDA, Mali, May 30 (Reuters) - Mali expects its seed cotton crop for the 2008/09 harvest to rise by 87 percent to around 462,000 tonnes due to good rains and an increase in producer prices, the agriculture minister said on Friday. Tiemoko Sangare said that Mali's cereal production was also expected to rise by 20 percent in the coming harvest. An increase in the state-regulated producer price to 200 CFA francs per kg from 160 francs last year was a key factor in the forecast rise in cotton output, the minister said. "For the harvest which is starting, we have set our ambitions at 462,000 tonnes," Sangare told reporters during a visit to an agricultural cooperative some 30 km (19 miles) outside the capital Bamako. Mali, one of West Africa's largest cotton growers, has produced an average of 500,000 tonnes in the last five years, but production slumped last season due to lower market prices and a lack of rainfall. "By fixing the price at 200 CFA francs, we are sure that farmers will have a reason to return to cotton," the minister said, adding that producer prices at this level had always resulted in output of 500,000 to 600,000 tonnes in the past. Overall production of cereals should rise to 4.7 million tonnes this season from 3.9 million tonnes in 2007/08, the minister forecast. Around a third of this would be rice, under a special plan to boost production to counteract a sharp rise in international prices, he said. Depressed international cotton prices have hit West Africa's millions of cotton growers hard. Burkina Faso, the region's top cotton producer, saw production slump to 360,000 tonnes last season from 660,000 in 2006/2007. (For full Reuters Africa coverage and to have your say on the top issues.

TODAY’S COMMENT: Cotton futures were modestly lower despite sharp losses in outside markets. This morning cotton futures are trading near unchanged. Sharply lower crude oil prices induced selling in soybeans and corn yesterday. The losses in crude oil were credited to the stronger US Dollar and the fact that the CFTC announced that they were increasing scrutiny of the energy derivatives markets. The ICE exchange then announced that they were “voluntarily” providing additional information on energies through their European business to the regulators. Traders then assumed that new regulations would come into effect and they sold. We think the selling was overdone and that the energy market and food and feed markets will recover soon. The regulators will first look at the data to find bad guys, and if they find some they will make examples of them. Then, they will look to see whether structural changes should be made…but this is a political question as much as an economic question…and the regulators will hold any ideas they have regarding this until a new administration is in place in Jan 09. Meanwhile, the food and feed markets will need to satisfy the world’s voracious demand for protein and any threat to production will result in higher prices. This morning, crude oil prices are up $1.17 at $127.74. November soybeans were down 13 ¾ cents at $13.07 ¾. December corn was down 4 cents at $6.05 ½. July wheat was unchanged at $7.43 ½. China’s cotton futures and forwards were modestly lower. India news reports say there will be some switching from cotton to soybeans in Gujurat, India’s biggest cotton growing state, and in nearby states as well. So far, the USDA has assumed little or no switching in India or China, but we expect them to eventually recognize that the attractive prices of food and feed over cotton apply to non-US farmers as well. Export sales information is scant this morning, but cotton sales were about 110,000 bales, on the low side of expectations. Corn and soybeans sales were within expectations. Today is the last trading day of the month and there could be additional price volatility as a result.


There is a risk of loss in futures trading.

High cotton prices keep business volume low: spot rate raised to Rs 3700

KARACHI (June 02 2008): The cotton consumers have come to such a point they have to lift cotton bales consoling themselves with an idea that all cotton bales they are buying are quality lots, as prices reached record high and outlook remaining sticky, during the week ended on May 21, 2008.

The spot rate was highest raised in previous week ended of 3650 while rates in ready had touched Rs 4000 for the second time.

WORLD SCENARIO:

In the absence of strong fundamentals futures remained afloat often dipping sharply due to fund sales, or grains showing softness during the week, with one couple holiday on the opening day in observance of Memorial Day.

On Tuesday, the first session contract dived down sharply from investor fund sales. The traders observed that follow-through investment sales of previous week spilled in to Tuesday's trading, incidentally week's opening day. The other commodities also aided downward drift owing to weakness in their values.

Meanwhile to have a grip on some number the players are keeping a watch on cotton crop's progress particularly in Texas, known for growing close to half of total cotton produced. Anyway contract dipped abruptly down by 2.96 cents to 66.25 cents a pound while new crop December conceded full three cents to 75.01 cents a pound.

On Wednesday players hoped market is heading towards consolidation. The optimism led to closing on mixed pattern. The market operators said as prices have touched bottom the market started monitoring development of cotton crop for the coming cotton season (July/August). However, reported hail in Texas had depressing effect side by side rain seen as boon. China cutting tariffs on cotton import in excess of annual quotas to ease prices for the domestic and clothing industry, also eased worry. Exporters started tightening belt to supply lint to China.

The meteorological report was a source of hope that said the key growing area of Texas was likely to get rains, beneficial to cotton in 2/3 days. On Thursday futures stayed infirm owing to weak report from Chicago about nearly all commodities plus investment fund sales. Consumers buying however resisted heavier fall. The buying support players said was encouraging but were hesitant to see it again.

The Friday session was not different and traders believed the coming week too won't be any different, small investors sales were far from inspiring. The closing day saw July contract retreating with 0.25 cent loss to 65.74 cent and December cotton gave in 0.27 cent to 74.37 cents a pound.

LOCAL TRADING:

Cotton buying support was interrupted mainly due to the fact that prices restrained consumers while fear that prices may even go higher brought them to cotton market for obvious reasons. The spectacle could be marked from day one when spinners and miller ware conspicuous by absence transpiring merely one deal of 1000 bales done at Rs 3950 being the highest one this year.

The spot rate was put at Rs 3600. Beyond market news was that rainfall has begun and initially it has been to benefit growth. The farmers should be on guard and where they were unable to serve they should move government agri field workers to help them.

The second days trading was somewhat sub factor with three big lot deals amounting to near 4000 bales priced at Rs 3665 and Rs 3950. The market sources were sharp in answering why 2nd day show was better. They predicted rise in prices particularly if better quality lots were available.

The rain has been described to be favourable and some very costly advance deals were made for June. However, advance sales reports were later dabbed as manipulated. Spot rate remained unchanged at Rs 3600. Which gives idea how rates in ready are being quoted. Even if new crop delivery started millers would go for 2008-09 cotton. Initially cotton crop supplied is said to be not as good.

On Wednesday spot rate was raised against general belief that ginner will tarry until arrival was seen either way. But sources felt that pains had caused perception change and hence spot rate was raised by Rs 50 to Rs 3650. In ready few thousand bales change hands.

On Wednesday the spinners and millers were in a fix as cotton prices maintained rising trend along side market showing dearth of desired quality lint. The result was only nearly 800 bales changing hands at historic highs of Rs 4000 per maund. Availability of quality cotton is according to the market sources, must or textile exporters were unlikely to dispatch orders in hands.

On Thursday the nearly non-availability of quality cotton made consumers restive. They were lifting a few bales at rate they considered high. Such as a solo deal was concluded at Rs 3800. The spot rate was raised by Rs 50 to Rs 3700 per maund. The ginners linked cotton rate with oil and dollar.

On Friday nearly buyers were constrained to lift for fear the wheels could halt. The spot rate was unchanged while rates in ready ruled at Rs 3600 and Rs 3740. The ball seems to be in ginners' court as spinners and millers reluctantly though cannot wait for long without obliging the sellers. On Saturday improves activity was seen as about 2200 bales changed hands within the price range of Rs 3800-4000. Spot rate left unchanged at Rs 3700.

MOONSOON'S JOYS AND SORROW ARE JUST AHEAD:

The new set up in Islamabad should take care right from now as the time is up to save growing cotton crop (or rice) from rain risks, which when comes to light often damage goes beyond control. This has been tradition but is expected to somehow be surmounted. As cotton need has multiplied and imports have to be avoided, to avoid ever rising deficit. However, what actually causes such big gap in trade deficit is luxury goods, machinery, dyes and chemicals and above all under invoicing.

The government is at it today the success in over coming odds that have lingered on for sixty years. The rains have started and in their rash have taken several lives. They come as warning to be watchful so that crop could be saved as far as possible.

From poor peasants to working for better crop be it cotton, rice wheat or any must not take rest until the end of the season to spare lags past have ruined the progress and prosperity. Until some knowledge based export sector, like information technology (IT), which seems to have been moving towards a definite goal, and is considered to run along textile sector looking sideward for a rest will not take Pakistan out of lurch.

The time is also for authorities to put finer or right type of cottonseeds to grow normally without accepting damaging pest and any conceivable attacks. Tragedy has always been caused for two main things: primarily that agri experts only point out dangers and leave on farmers and fate to do the rest so that risks are as negligible as possible something is done to get better Bt cottonseeds and for the other who don't wait for drugs keep in reserve. And, for God sake, get rid of imports and try to use to manufacture of every thing from machinery to all raw materials required for textile plus sector.

TRADE DEFICIT PROJECTED $18BN PLUS:

Never in Pak history is sought to discover why should there be trade deficit without a break: why is it so? Those who cause it even they never ponder over it. If ever it comes in reference to government failure to facilitate traders and exporters. Government has thus for quietly squeezed under-collected servicemen taxes to facilitate the declining textile or any sector trend.

The major forex earners such as textile exporters have self-made, dozens of claims how it is responsible for employing a good number of illiterate people and earning sector, which singly contributes highest to the exchequer. Unfortunately textile or any sector showing declining trend in exports have never been asked whether 60 pc or like amount claimants earn is sufficient to develop under developed areas or, whether the amount compares with earnings of regional rivals who started travelling along this country. Thailand, Malaysia, Indonesia, India or China for example all stay far ahead of Pakistan's.

Government has responsibility to see various forex-earning sectors remain competitive but at what cost a perennial decadence? Today Pakistan is at its worst end, is this all because of governments remaining unmindful of export progress at his or their sake. Lust for staying in government or remain stuck with some remunerative assignments is quite natural.

The government fearing, however, are those who not for a moment allows people to face unnecessary ails. Once again the poor is being talked, and once again those having contracts in Islamabad are being assured to get good care in coming budget, the wage earners will however keenly watch whether their Rs 6000 per month wage will be in hand with out fellow labourers being laid off.

AMOUNT JUMPS TO $50MN:

Amidst wide varieties of flowers and desire for a long lasting relationship between Pakistan and the US, exporters hue and cry says a different story-story of $5 bn worth textile exporters exports at different US and Canadian Ports. On the one hand when high cost of doing business is limiting the textile products exporters' prospects, the already dispatched goods to land of friends are dumped on various ports un-cared and un-cleared. The exporters are worried about their $50 million exports for remaining unpaid for several months. Their plight could be gauged clearly in liquidity crunch additionally because such big amount remaining in such distant places with their own rules and laws.

The fact those consignments are lying at the two country ports. Besides telling the demurrage piling due to fraudulent freight forwarders and shipping companies report is silent. It s silent what was the ground for alleging forwarders and shipping companies. However, report as is practices shipping companies register the names of freight forwarding companies on export consignments. The exporters are provided with fake export documents. Strangely the report puts 100 exporters have been stuck up in Canadian and US ports while, they said State Bank of Pakistan has asked the exporters to pay back the money.

Several exporters out of a 100 informed Director FIA about the incident and sought FIA help in retrieval of their consignments. On the basic of complaints of at least six textile exporters agency started inquiry into two cases and when the process will be completed formal FIR will be lodged, FIA director said. In the process a sordid fact came to light that many exporters do not know the procedure how to get the agency initiate a probe.

Meanwhile the agency had retrieved $0.3 million of exporters whose consignments have stuck up abroad. But he advised them to escape such cases they must make it a habit to read the documents they receive from freight forwarders and shipping companies so that they are able to pre-emptively foil such bids.

WTO: OPTIMISM PAK EXCELLENCE:

The inordinate delay in striking a deal for seven years is hard to digest, said knowledgeable sources. A number of new issues have sent experts and economists on their toes. Notable being falling value of dollar and rising gasoline prices. Once again June or July is being targeted for likely deal, which in all likelihood will prove to be optimistic par excellence.

The WTO touch Pakistan more importantly because textile exports being the highest forex earners and offer employment to largest numbers. But as the condition exists textile sector is almost blocked for being faced with high cost of doing business. The govt seems not in first exporters that the neighbouring govts have been facilitating their textile exporters with a number of subsidies.

Unless the government is clear on the issues how can it be clear how much help it should providing to the textile exporters. It has not been thoroughly researched whether their claim is true.

There is another factor that needs to be thoroughly calculated how much they are affecting or aiding the high cost of doing business. Sources propound that cost of imports of textile machinery, dyes and chemicals besides other should be at hand to the sure whether these actually add to high cost of doing business. The findings will, sources said may reveal that these factors are facilitating India, China and other to match or compete rivals in foreign markets.

The cause should be found out as to why for sixty years no textile machinery plant has been set up in Pakistan (while India and China had years before) why dyes and chemicals units have been completely ignored all these year by Pakistan while India and China are not only catering to the needs of their local consumers but enabling countries to export dyes and chemicals and how funny is that Pakistan patronise these countries and imports in billions and billions of dollars annually. Pakistan can also approach WTO conciliatory body Pak rivals are being offered huge subsides making this country to lose edge.

Whether by year end 150 members of WTO agree to reach accord and sign deal or leave in lurch WTO for year or for ever, government will have to keep keen eye on certain sectors who have been truant boy like with the economy and progress of Pakistan. Subsidies or exemption from duty or taxes won't allow market to be linked with developed roads in conceivable time period.

Project to evolve hybrid Bt cotton variety launched
MULTAN (June 03 2008): After achieving phenomenal acclaim from the developing world in Basmati rice variety, a local business group has now launched a research project involving Pakistani and Chinese scientists to evolve a hybrid Bt cotton variety, claimed a company executive.

Shehzad Ali Malik, director (marketing), Guard Group producing agricultural as well as auto-related products, was speaking at a ceremony to inaugurate the Guard AutoZone operation from Multan at a CNG station late on Sunday night. He said the company plans to establish 1,200 such facilities at CNG stations in three years.

The president, Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Mian Tanveer Sheikh, company chief executive Iftikhar Ali Malik, Saarc Chamber of Commerce and Industry representative Tariq Saeed, LCCI President Muhammad Mian, and senior company executives were present on the occasion.

FPCCI chief Tanveer Sheikh lauded the company for taking lead in introducing indigenous Pakistani products like its Basmati rice, adding that producing and marketing branded products has been made a part of the trade policy of the country.

Shehzad Malik promised to carry out demand-based research on cotton to evolve varieties that meet the requirements of the textile industry. He said this sector still imports seed with qualities like long staple, etc, while hybrid Bt cotton being developed by the company will meet all requirements and will be CLVC-resistant to solve the problem affecting cotton growers for decades.

He paid rich tribute to the late Dr Abdul Majeed, who developed the Guard Basmati rice variety, and the efforts of his father late Muhammad Shafi Malik, who began the business under the name 'Malik Autos' in 1949, and since then the company never looked back.

Shehzad Malik said that rice is being exported to 38 countries and has helped boost rice export earnings to $700 million per annum. He expressed hope that the to-be-developed hybrid Bt cotton variety will bring about a positive change in the cotton economy

Low activity due to higher prices on cotton market

KARACHI (June 03 2008): Thin business was seen on cotton market on Monday due to higher trend in the prices, experts said. The Karachi cotton Association (KCA) official spot rate was unchanged at Rs 3700, dealers said. Many mills were on the sidelines due to higher trend in the prices, brokers said.

The rising trend in the prices is disappointing factor for the local spinners as rates were coming down in the NY cotton futures, they said. Naseem Usman said that the prices of cotton are high due to quality factor, it is likely that the textile items may show improvement in the coming days. A solo deal of 1300 bales of cotton from Khanpur Mehar at Rs 3800, they said.

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The KCA Official Spot Rate for Local Dealings in Pak Rupees
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FOR BASE GRADE 3 STAPLE LENGTH 1-1/32"
MICRONAIRE VALUE BETWEEN 3.8 TO 4.9 NCL
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Rate Ex-Gin Upcountry Spot Rate Ex-Karachi
for Price Sales Tax @ 15%
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37.32 Kgs 3700.00 50 3750.00
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Equivalent
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40 Kgs 3965.00 50 4015.00
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