|
ANALYSIS: exporters revive cotton prices
DR ZAFAR HASSAN
After a sizeable slump recorded in cotton prices over the
previous several sessions, exporters entered the market which
resulted in the increase in lint prices on Thursday by Rs 25
to Rs 50 per maund (37.32 kgs).
Prominent exporters who have been active recently include
Messrs Hakimuddin Harmusji, Rehmoumer and company, Haji
Khudabux Amir Umer, Dadasons, Naseem Enterprises and Meezan
Enterprises.
It has been reported that enquiries and export sales into
Bangladesh prompted increase in cotton prices even though the
quantities involved are not very large. Despite widely held
anticipation that current cotton crop (2004-2005) is shaping
up extremely well and even the quality of lint is said to be
very good, export enquires imparted strength to the cotton
market on Thursday which revived again.
Reports of current crop (2004-2005) output continue to be
couched in very optimistic terms, and if market talk is any
indications, Pakistan should harvest a record output.
Furthermore, spinners are very happy with the quality of lint
arriving from Sindh and are very optimistic that Punjab grades
of lint are likely to improve further in a substantial way.
Therefore, when the prices started to sag in the recent past
exporters entered the market and mills also want to build up
their inventories as a long-term strategy.
The current cotton season (2004-2005) is moving into full
swing where all sectors including the growers, the ginners,
the spinners and the exporters are finding it quite
remunerative.
At present, nearly 75,000 bales are being ginned daily, which
figure is expected to rise to about 100,000 bales (160-170
kgs) by the beginning of next month viz. 1st of October 2004.
Most estimates of current crop (2004-2005) output in Pakistan
are now hovering around the figure of 12.5 million to 13.5
million bales which traders say can be even higher and could
create a new record.
The seedcotton (kapas/phutti) prices also tightened by about
Rs 25 per 40 kgs on Thursday. Thus the prices of seedcotton in
both Sindh and Punjab were said to have ranged from Rs 925 to
Rs 975 per 40 kilograms.
The growers and the ginners are lending credence to Prime
Minister Shaukat Aziz's assertion that the Trading Corporation
of Pakistan (TCP) would definitely step in if the cotton
prices go below the support price indicated for the current
season (2004-2005) which is RS 925 per 40 kilograms.
Some of the ready sales reported on Thursday included 300
bales of cotton from Mirpurkhas in Sindh at Rs 2075 per mound
(37.32 kgs); 400 bales also sold in Mirpurkhas at Rs 2100 per
maund; 1000 bales each from Sanghar and Tando Adam sold at Rs
2100/Rs 2125 per maund; 2000 bales from Shahdadpur sold at Rs
2125/Rs 2135 per maund, wh1le 2000 bales from Nawabashah were
said to have been sold at Rs 2150 per maund.
Punjab cotton prices also perked up on Thursday. In Burewalla,
600 bales were sold at Rs 2125 per maund (37.32 kgs); large
quantities of cotton are da1ly sold in Punjab so that almost
all the cotton pressed by the ginners is taken up by the
mills, therefore, the spinners are lifting nearly 70,000 to
75,000 bales daily in both Sindh and Punjab.
Sales were also reported from such stations as Rajanpur, Mian
Channu, Chistian, Jehania, Bahawalpur and Bahawalnagar at
prices ranging from Rs 2115 to Rs 2140 per maund. The tone of
the market was described as being steady in the evening.
Mills in Pakistan are expected to use more than 1 million
bales of domestic size cotton every month during the
forth-coming season (2004-2005) while some traders expect it
to be much higher.
The United States dollar has strengthened in recent weeks and
has attained a two-year high level in the interbank market
against the Pakistan rupee which would make imports dearer
while encouraging exports from Pakistan.
Cost of dollar has now moved up considerably beyond Rs 59.
Certain mills are also said to be desirous of settling their
cotton import bookings if possible with the shipper and are
also said to be prepared to pay any difference involved. Due
to their commitments at various origins, the shippers may find
it difficult to oblige the mills.
On Thursday the Chairman of the Karachi Cotton Association
(KCA) Iqbal Umer, invited the commissioner of income tax,
spec1al zone, corporate region, Karachi, Irfan Nadeem to
discuss matters of mutual interest. Iqbal Umer highlighted the
role of KCA in the marketing of raw cotton.
The chairman KCA extolled the competence of Irfan Nadeem and
said he has been recently posted at Karachi after successfully
completing the task assigned to him to increase tax revenue
from the Lahore region.
Iqbal Umer pleaded with the commissioner of income tax,
special zone, corporate region, Karachi for his help and
assistance to the business community with special reference to
the cotton traders to resolve the outstanding problems
relating income tax.
On his part, Irfan Nadeem stated that the government is taking
all the necessary measures to simplify the taxation system in
order to provide relief to the tax payers.
Irfan Nadeem also assured the KCA that the income tax
department is examining the tax refund cases on merit in order
to ensure prompt payment of refund claims to the assesses.
In order to restore the confidence of the tax payer, the
income tax department is accepting the version of the assesses
under the self assessment scheme to provide a friendly
environment between the tax payers and the tax collectors.
Regarding the government decision to induct the Trading
Corporation of Pakistan (TCP) to support cotton prices for the
prevailing season, the new chairman of the Pakistan Cotton
Ginners Association (PCGA) Haji Ibrahim desired that the
government should instruct the TCP to lift all the cotton
tendered to it at the option of the ginners.
Haji Ibrahim appreciated the government decision to induct the
TCP to support cotton prices if they fall below the announced
price of Rs 925 per 40 kgs, but he was bitter about the past
experience in this regard with the TCP.
He also pleaded with the government desiring that 85 percent
of the cost of cotton should be paid through the regional
offices and ginners should not have to go to Karachi so as to
avoid lengthy delays for receiving their payments.
Haji Ibrahim asked the government to lift all the grades of
cotton from 1 to 4 in case the mills were not forthcoming with
the purchase of cotton.
Arif Saeed, a very prominent spinner belonging to the
prestigious service group of industries has been elected as
the next chairman of the All Pakistan Textile Mills
Association (Aptma) central zone.
Curtesy: Business Recorder
|
Pakissan.com;
|
