KARACHI: The price of cotton remained generally stable. The conflict between Pakistan and India has affected business, leading to a decline in volume.
All commercial and industrial institutions in the country have declared full solidarity with the Pakistani military in the war between Pakistan and India.
There were earlier indications that a decision on Export Facilitation Scheme (EFS) would be made in the upcoming budget, but during a recent Senate session, it was stated that no decision on EFS would be included in the budget. All Pakistan Textile Mills Association (Aptma) and other relevant industrialists have expressed serious concerns.
Iftikhar Ali Soho, Secretary Agriculture Punjab said that in Punjab, cotton has been cultivated on over 2.2 million acres of land, with a target set at 5.5 million acres.
The Karachi Cotton Association (KCA) has appreciated the efforts of all relevant individuals and institutions in reviving cotton production in the country.
Along with the revival of cotton, there is an urgent need to improve quality.
Chairman Pakistan Cotton Ginners Forum Ehsan-ul-Haq said that the arrival of partially opened cotton from the new season has begun in coastal cities of Sindh. Advance trading of cotton is underway.
Head Transfer of Technology Central Cotton Research Institute Multan said that the Federal Committee on Agriculture (FCA) has set a cotton production target of 10.18 million bales for the current year 2025-26.
Over the past week, needy spinners have been purchasing cotton at rates ranging between Rs 16,500 to Rs 17,500 per maund, depending on quality and payment conditions. Ginners now have limited stock left, and mills are buying based on quality. The trading volume is low, and quality is also limited.
Large textile mill groups are importing cotton, yarn, and fabric due to better quality, with the EFS being the most beneficial. Although there were earlier indications that the upcoming budget might address the EFS, recent Senate meetings clarified that no decision on EFS will be included in the budget
According to reports, the government will not withdraw the Export Facilitation Scheme (EFS) in the 2025-26 budget. However, leading export associations, manufacturers, and exporters expressed strong reservations against the EFS during a meeting with the Senate Standing Committee on Finance on Monday.
In response to a question, a senior government official told Business Recorder that there is no possibility of discontinuing the EFS in the upcoming federal budget.
The Senate Standing Committee on Finance and Revenue, chaired by Senator Saleem Mandviwalla, held a meeting on Monday to initiate consultations with associations across the country regarding preparations for the upcoming budget. The meeting focused on challenges and recommendations presented by major sectors, including textiles, poultry, dairy, steel, property development, and consumer goods.
In Sindh’s coastal cities, the picking of the new cotton crop has started in small quantities, leading to the commencement of advance trading of cotton. For the first time in Pakistan’s history, the new cotton ginning season is expected to begin in the first week of May. Meanwhile, advance trading of cotton from the new crop has already started.
Initially, two ginning factories in Punjab’s cities of Burewala and Mandi Jahaniyan sold 600 bales of cotton in advance deals at Rs. 17,000 to Rs. 17,300 per maund, with delivery scheduled between 10th and 15th May. These factories purchased cotton from Sindh’s coastal cities at Rs 8,300 to Rs 8,500 per 40 kg.
In Sindh and Punjab, cotton prices are currently ranging between Rs. 16,500 to Rs. 17,500 per maund, depending on quality and payment conditions.
The Spot Rate Committee of the Karachi Cotton Association maintained a stable spot rate at Rs. 16,700 per maund.
Karachi Cotton Brokers Forum Chairman Naseem Usma told that after fluctuations in international cotton prices, overall stability was observed. The price of New York cotton futures remained between 66.50 to 69.50 US cents per pound after some volatility.
According to the USDA’s weekly export and sales report, 65,800 bales were sold for the 2024-25 season.
Vietnam topped the list by purchasing 30,500 bales. Turkey came in second with 16,200 bales. India ranked third with 9,300 bales.
For the 2025-26 seasons, 37,400 bales were sold. Mexico led with 30,700 bales.
Indonesia secured the second position with 11,500 bales. Pakistan came in third with 2,200 bales.
Meanwhile, a review meeting on cotton cultivation was held in Multan under the chairmanship of Punjab Agriculture Secretary Iftikhar Ali Soho. In Punjab, cotton has already been cultivated on over 22 lakh acres, with a target set for cultivation on 35 lakh acres in the province.
Additionally, during the meeting, the All Pakistan Textile Mills Association (APTMA) proposed that yarn and fabric be excluded from the EFS. They suggested that cloth and cotton yarn should be included in the negative list of EFS, as the scheme currently restricts the domestic supply chain.
APTMA further proposed that cotton yarn and cloth be brought under the normal tax regime to prevent the collapse of the domestic industry.
The association also recommended reducing the advance tax in the budget from the current 2.25% to 1%.
Moreover, APTMA Chairman Kamran Arshad warned that textile exports have been stagnant for the past two years. He criticized the EFS scheme for pushing the industry toward ruin, highlighting issues such as the imposition of an 18% sales tax on local cotton and duty-free imports of foreign cotton. APTMA recommended keeping cotton yarn and cloth on the negative list, setting electricity rates at 9 cents per unit, and reducing the advance tax rate from 2.5% to 1%. The association revealed that 120 spinning mills and 800 ginning factories have already shut down, while textile exports have stagnated at 16.5% and 16.7% over the past two years.
Furthermore, based on reports in the electronic media, the Karachi Cotton Association understands that APTMA and the Pakistan Cotton Ginners Association (PCGA) are jointly working on drafting a national cotton policy, finalizing the format for raw cotton sales/purchase agreements, and making efforts to revive cotton production in the country.
The Karachi Cotton Association (KCA) appreciates the efforts of all stakeholders in reviving cotton production in the country. It is important to note that KCA is inviting all stakeholders in the cotton economy, as significant time is approaching for joint efforts to formulate a unified strategy by the government to increase cotton production in the country. This will help meet the growing demand of the local textile industry, leave a surplus for exports to earn valuable foreign exchange, and enable KCA to avoid cotton imports to conserve foreign exchange received from abroad. However, other stakeholders in the cotton trade have not responded positively for unknown reasons.
KCA has repeatedly urged the government to take necessary measures for the benefit of the entire cotton trade and industry, including improving cotton quality, ensuring proper bale packaging, and maintaining the standard weight of 170 kg per cotton bale.
The Karachi Cotton Association (KCA) believes that cotton exporters, being secondary buyers, play a crucial role in stabilizing the cotton market and protecting the interests of cotton growers. KCA also believes that any national cotton policy introduced by the government should be approved after consultation with all stakeholders in the cotton economy, including the Karachi Cotton Association—the premier body of the cotton trade in Pakistan.
Here, it is noteworthy that a few years ago, the KCA drafted an agreement for the local sale/purchase of raw cotton under the bylaws of the Karachi Cotton Association, which provides the authority for arbitration in case of any dispute between the buyer and seller. This draft was sent to APTMA and PCGA for approval. The PCGA granted its approval in this regard, but approval from APTMA for the draft agreement on the local sale/purchase of raw cotton has still not been received.
The KCA believes that the draft agreement for the local sale/purchase of raw cotton was prepared after extensive efforts and with the approval of both the KCA and PCGA. In such a situation, APTMA should also consider/approve the draft agreement for the local sale/purchase of raw cotton prepared by the KCA and avoid the time-consuming exercise of preparing a new draft agreement for the local sale/purchase of raw cotton.
The KCA urges the government to finalize/approve any national cotton policy in consultation with all stakeholders of the cotton trade, including the Karachi Cotton Association.
The KCA should ensure that government must take necessary measures to increase cotton production, improve cotton quality, ensure proper bale packaging, and produce standard 170 kg cotton bales for the benefit of the entire cotton trade and industry.
The role of quality in cotton marketing is extremely important, as it directly affects the price, demand, and competitiveness of cotton in both domestic and international markets.
High-quality cotton has open access to premium markets, while poor-quality cotton limits buyers or leads to discounts. Cotton with superior fibre length, strength, fineness, and cleanliness is always in high demand. Spinners and textile mills prefer high-quality cotton because it reduces processing issues, minimizes waste, and yields better final products. Quality parameters are often linked to traceability systems and certifications, which are becoming increasingly important in the global market.
Unfortunately, in Pakistan, along with the decline in cotton production, the quality of cotton has also deteriorated over the past three decades. Poor quality, unfair government policies, and high cultivation costs have made local cotton uncompetitive. As a result, the textile industry has preferred sourcing cotton from other countries such as the U.S. and Brazil, leading to a gradual decline in demand for local cotton despite lower production.
The new cotton season 2025/26 is about to begin, with ginning operations starting soon. However, around 0.3 million bales remain unsold with ginners, while spinners are covering their positions with imported cotton.
Our ginning season begins with excessive moisture, and even in the later stages, cotton not only becomes expensive but also faces yarn quality issues.
During a telephonic conversation with renowned cotton analyst Naseem Usman, Sajid Mahmood, Head of the Technology Transfer Department at the Central Cotton Research Institute (CCRI) Multan, provided insights into the current status of cotton cultivation across Punjab and Sindh. He stated that for the 2025–26 season, the Government of Punjab has set a cotton cultivation target of 3.5 million acres. As of May 1, approximately 1.488 million acres have been sown, representing 43% of the targeted area. The performance across South Punjab has been mixed, with key cotton-growing districts such as Multan, Khanewal, Vehari, Lodhran, Bahawalpur, Bahawalnagar, Rahim Yar Khan, Dera Ghazi Khan, Layyah, and Muzaffargarh showing varying results. Multan Division has achieved 63% of its target, Dera Ghazi Khan 50%, while Bahawalpur lags at 29%.
In contrast, North Punjab has shown relatively better progress, achieving 51% of its cultivation target, with Faisalabad emerging as the top performer.
Commenting on the situation in Sindh, Sajid Mahmood reported that by April 30, only 415,761 acres had been cultivated against the provincial target of 1.556 million acres—just 26.71% of the goal. In Upper Sindh, where major cotton-producing districts include Sukkur, Ghotki, Khairpur, Naushero Feroze, and Qambar Shahdadkot, there has been a 16% decline in cultivated area compared to last year. Central Sindh districts such as Hyderabad, Matiari, Tando Muhammad Khan, and Tando Allahyar have recorded an alarming 81% decline, while in Lower Sindh—comprising Umerkot, Mirpurkhas, Badin, and Thatta—the decrease stands at 67%.
Sajid Mahmood highlighted that the Federal Committee on Agriculture has set a national cotton production target of 10.18 million bales for the 2025–26 season. However, he cautioned that the revival and sustainable growth of the cotton sector face a complex set of challenges requiring urgent policy-level intervention.
Copyright Business Recorder, 2025
