The local cotton market witnessed a surge, with prices reaching a season-high of Rs20,000 per maund, driven by a 51% shortfall in domestic production and delays in imported cotton shipments.
The textile industry, bolstered by substantial export orders, has turned to local cotton as the arrival of imported shipments faces delays, now expected in May instead of March.
Deferred payment cotton prices climbed to Rs20,000 per maund, while routine payment prices ranged from Rs19,000 to Rs19,500 per maund. Market analysts anticipate further increases as demand remains high.
Cotton Ginners Forum Chairman Ihsanul Haq attributed the delay in imports to issues with Brazil’s cotton fumigation process, reportedly caused by a shortage of necessary chemicals.
On the other hand, the Federal Board of Revenue (FBR) has scheduled a meeting on January 13 in Islamabad to decide whether to continue the 18% sales tax exemption on imported cotton and yarn.Â
The meeting follows Prime Minister Shehbaz Sharif’s directive, issued after appeals from cotton growers and ginners protesting against price disparities between local and imported cotton.
The FBR is expected to address the concerns of cotton stakeholders and determine the future of tax exemptions, a decision with significant implications for the textile industry and local cotton growers alike.
