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Pakistan's cotton imports surge

With a sudden surge in import of cotton in the last two months, Pakistan is expected to import a total of 2.5 million bales during the ongoing fiscal 2013-14. Pakistan has imported approximately 1.7 million bales so far during this fiscal year. Traders are importing a significant amount of cotton from India as this saves freight cost and transportation time. So far, Pakistan has imported approximately 1.2 million bales from India.

In the beginning of the year, imports were slow because of two reasons. Spinning mill owners were waiting for local cotton to arrive in the markets. Secondly, import cost was higher because of the continuous appreciation in dollar value against rupee at that time. 

Now, the situation has changed. The rupee has considerably recovered its value against the dollar during December and January. Secondly, ginners in Pakistan have a small quantity of high quality cotton in stock. The low availability of high quality cotton always forces traders to increase imports. Pakistan imports high quality cotton from India, US, Argentine and Central Asia every year. However, imports from India may slow down after India raised the price of cotton higher than other exporting countries.