Pakistan likely to import 3 million cotton bales as decline in output continues

Pakistan is likely to import three million bales of cotton in fiscal year 2024-25 to fulfil the textile sector's demand amid a continued decline in production output, an industry leader informed Nukta on Wednesday.

The country's cotton arrivals declined by 60% to 1.22 million bales at the end of August compared to the same period last year, Pakistan Cotton Ginners Association data showed.

Of the 1.22 million bales produced, nearly 1.17 million were bought by the textile sector while 400 bales were purchased by exporters.

During the last season, cotton output was around 10.2 million bales, according to government estimates. Since this was insufficient for the textile sector, which is the backbone of Pakistan's exports, it imported cotton worth $448 million, down from $1.67 billion a year earlier.

Experts believe cotton production during the current season might range between 7-8 million bales, which would dent the GDP by almost 0.25%.

One analyst stated that with a harsh monsoon season and some cotton-growing areas affected by floods, output would suffer more. However, it is too early to assess the extent of overall damage to the crop.

The industry expert said that this year, the textile sector would require around 10 million bales and hence, it would need to import three million bales due to insufficient output.

Due to rains and reports of some damage to the standing crop, the price of the commodity has recently spiked in Punjab and Sindh. The price is around PKR 19,500 ($70) and PKR 19,200 per maund in Punjab and Sindh, respectively.

Cotton arrivals in Sindh dropped by 61% to 773,091 bales compared to the same period last year and by 58% to 452,855 bales in Punjab, according to the data.