Cotton Arrivals: Sindh Leads The Path Of Victory!

Pakistan Cotton Ginners Association (PCGA) recently released figures of cotton arrivals up to October 01, 2013. In today's Karachi Stock Exchange Analysis we present an analysis of recent cotton arrivals trend along with our outlook on the same.





Cotton Arrivals Up By 7%YoY In FY14TD

Despite heavy rainfall in upper Sindh and lower Punjab, cotton arrival figures portray a positive picture during the current season. Cotton arrivals, according to the data released by PCGA, during the said period grew by 7%YoY to 3,684k bales as compared to 3,447k bales during the same period last year. During the said period, Sindh contributed 59% (2.2mn bales) in total cotton arrivals so far, while Punjab contributed 41% (1.95mn bales) during the aforementioned period. On fortnightly basis, cotton arrivals declined by a massive 38%YoY to 1.1mn bales as compared to 1.72mn bales during the corresponding period last year.

Province-wise analysis shows a massive change as far as cotton arrivals are concerned. Sindh, remained the show stopper, as arrival of cotton from its leading producer district Sanghar posted a colossal growth of 27%YoY to 1,083k bales as compared to 851k bales during the same period last year, sharing 29% of total arrivals. Similarly, Hyderabad and Tharparker's cotton arrival also improved by 38%YoY to 215k bales and 11%YoY to 274k bales, translating into13% participation in country's total cotton arrival so far. In the province of Punjab, cotton arrivals from its major producing districts were still subdued as its districts Khanewal and Vehari each accounted for a 6.8% weight in total cotton arrivals posting a massive decline of 27%YoY to 251k bales and 26%YoY to 252mn bales. Following the same declining trend, cotton arrivals from Sahiwal, Bahawalnagar and Bhawalpur were also on the declining path.





Local Cotton Prices Increase By 39%YoY

Expectation of low cotton production coupled with increasing demand of cotton on local front are the major concerns fuelling up cotton prices by 39%YoY to Rs7,250/37.325kg on October 01, 2013 as compared to same day last year. However during the ongoing season (from 01, Sep 2013 to date) the average prices remained at Rs6,886/maund as compared to Rs5,523/maund in the same period last year. However, during the said period cotton prices on the international front increased only by 16%YoY to 92.95 cents/bbl due to higher backlog of cotton stock.





Outlook: Rising Demand Pulls Cotton Prices Higher