The cotton market remained steady with satisfactory trading volumes. The crop is threatened with pest attacks that may cause damage to output. However, for the first time the Punjab government has taken quick remedial steps deploying drones for spray as well as taking help from the army to use its helicopters for pest spray.
The trading volume remained satisfactory throughout last week. In Sindh cotton was traded between Rs 18,500 to Rs 19,000 per maund. The rate of Phutti in Sindh ranged between Rs 8,000 to Rs 9,000 per 40 kg. In Punjab the price was little higher as cotton fetched Rs19000 to Rs1950 per maund. The rate of Phutti in Punjab was lower than Sindh being between Rs 8,000 to Rs 8,200 per 40 kg. The rate of cotton in Balochistan was the same as in Sindh at Rs 18,500 to Rs 19,000 per maund while the rate of Phutti ranged between Rs 8,500 to Rs 9,500 per 40 kg. Polyester Fiber was available at Rs 378 per kg.
Around, 2400 bales of Saleh Pat, 1600 bales of Rohri were sold at Rs 18,800 to Rs 19,000 per maund, 2000 bales of Khair Pur were sold at Rs 18,700 to Rs 19,000 per maund, 600 bales of Halari were sold at Rs 18,700 to Rs 18,800 per maund, 600 bales of Akri were sold at Rs 18,700 to Rs 19,000 per maund, 800 bales of Rasool Abad were sold at Rs 18,700 to Rs 18,800 per maund, 800 bales of Nawab Shah,600 bales of Hyderabad, 1400 bales of Sanghar were sold at Rs 18,000 to Rs 18,400 per maund, 3400 bales of Tando Adam were sold at Rs 18,000 to Rs 18,500 per maund, 800 bales of Sui Gas were sold at Rs 18,800 per maund, 600 bales of Tando Muhammad Khan were sold at Rs 18,300 per maund, 1200 bales of Mehrab Pur were sold at Rs 18,000 to Rs 18,700 per maund, 800 bales of Rani Pur were sold at Rs 18,500 per maund, 800 bales of Yazman Mandi were sold at Rs 19,500 per maund, 400 bales of Bahwal Pur were sold at Rs 19,000 to Rs 19,500 per maund, 100 bales of Chistian were sold at Rs 19,500 per maund, 3200 bales of Haroonabad were sold at Rs 19,200 to Rs 19,500 per maund, 600 bales of Chichawatni were sold at Rs 19,650 to Rs 19,000 per maund, 1600 bales of Mian Wali were sold at Rs 19,500 per maund, 1800 bales of Fort Abbas were sold at Rs 19,300 to Rs 19,500 per maund, 1800 bales of Layyah were sold at Rs 19,000 to Rs 19,500 per maund, 800 bales of Samundri were sold at Rs 19,000 per maund, 400 bales of Faqeer Wali, 800 bales of Vehari were sold at Rs 19,500 per maund and 200 bales of Shujabad were sold at Rs 19,200 per maund.
The scale of the whitefly attack, which experts say has been caused by a sudden hike in temperatures across the cotton belt during the last couple of weeks, has raised fears of an extraordinary decrease in per acre crop yield that is contrary to the general expectation lint production target may not be achieved this year too. The areas of Bahawalpur, Rajanpur and Dera Ghazi Khan are said to be among the worst-hit. A record cut in the arrival of cotton in markets and ginning factories is also being reported. Chief Minister Mohsin Naqvi has dispatched Agriculture Secretary Iftikhar Sahoo and other top officials to the affected region, while help of army’s helicopters and drones has also been sought to spray pesticides.
Cotton Ginners Forum Chairman Ihsanul Haq said the attack began a couple of weeks ago and it is affecting the growth of the plant due to the blackening of the leaves. He feared that the attack would not only affect the overall domestic production of cotton, but the quality of the produce as well.
Meanwhile Cotton production has witnessed a 23 percent increase compared to the previous year in Sahiwal division. Last year, 137,000 bales were produced, but this year’s harvest has surged to an impressive 179,000 bales, and of them 116,734 bales have hit ginning factories.
In the Americas Brazil is fast taking over the United States as the top agricultural exporter. Brazil has already replaced the US as top Corn and Soy Exporter in the world. Cotton Is Next. US cotton crop size, quality have fallen amid droughts and margins. Brazil is close to unseat the US as world biggest cotton exporter as Texas, the United States top cotton producing state buckles under searing heat and drought.
In the United States the holiday-shortened trade week did not lack action. December futures continued to move higher, briefly touching 90 cents per pound, before eventually settling at 89.95 cents per pound. This is the highest level seen in over a year. After the long weekend, futures prices turned lower, and the descent continued for the remainder of the week. Pressure was added from the Chinese market, speculative selling, and slightly improved crop conditions in Texas. December futures settled at 85.38 cents per pound, showing a loss of 244 points from the week prior and posting three days of consecutive losses. Open interest continues to rise, and at one point this week, the biggest one-day increase seen since 2011 was reported. Since last week, total open interest managed to add 16,011 contracts to reach 228,363.
Much like cotton, outside markets went into the weekend on a good note after the Labor Department’s jobs report showed that the U.S. unemployment rate rose to 3.8 percent. The enthusiasm was short-lived, and major indexes were mixed after the long weekend. Data out of China reported a slowdown in the service industry and the ever-present inflation worries in the U.S. weighed on stocks throughout the week. Despite the higher unemployment rate reported last Friday, weekly initial jobless claims fell to a 7-month low of 216,000, a sign of a persistently strong labor market. Crude oil rose to the highest level seen so far in 2023. Worries of a decreased supply in oil intensified when Saudi Arabia and Russia announced extended production cuts through the end of the year. The U.S. Dollar rose to an almost 6-month high this week on the economic data released this week.
Due to the Labor Day holiday, the Export Sales Report for the week had a delayed release. But the Export Sales Report held higher than expected a week earlier. Net sales of 85,100 Upland bales and 2,800 Pima bales were reported for the 2023/24 crop year. Sales continue to lag for what is typical at this point in the marketing year. The biggest buyer for the week was Mexico, booking 28,900 bales, followed by Costa Rica with 22,400 bales, China with 16,200 bales, Vietnam with 11,700 bales, and Thailand with 4,800 bales. Shipments were also lower than what is usual at this point in the year. A total of 175,400 Upland bales and 4,400 Pima bales were shipped.
Little change in the weather was present across the Southwest this week, small amounts of precipitation and above average temperatures were reported. The heat is set to continue into the weekend, but much cooler temperatures and the possibility of scattered storms are forecast to move into the South Plains in the coming week. Many areas in South Texas have wrapped up harvest for the year and ginning and classing have taken focus. Crop conditions in the country were basically unchanged from the week prior, a nice relief after weeks of deteriorating conditions.
The World Agricultural Supply and Demand Estimates (WASDE) Report will be released this week. Little else matters to traders than what USDA reports for the US crop and world demand. The Export Sales and Crop Progress and Condition reports will play their usual role when looking at supply and demand.
In China buyers including a state-owned Chinese company are stockpiling Australian cotton in Chinese warehouses, betting that a three-year ban on imports will soon be lifted as diplomatic and trade ties between Beijing and Canberra ease. Chinese customs data shows that 43,364 metric tons of Australian cotton entered bonded warehouses in China in the first seven months of this year, more than double all of 2022.