Cotton Crisis in Pakistan: Declining Production and Prices Alarming Growers

Pakistan’s cotton industry is facing a dual crisis of declining prices and production, leaving growers and ginners in Punjab province deeply concerned. Despite a significant reduction in domestic production, the steep drop in cotton prices and sluggish sales is creating an unprecedented challenge for the sector.

Plummeting Production Amid Record Imports

As per data from the Pakistan Cotton Ginners Association (PCGA), by December 15, 2024, the country’s total ginned cotton production stood at 5.36 million bales, reflecting a staggering 33% decline compared to the same period last year. The downturn has hit major cotton-producing provinces like Punjab and Sindh the hardest, with reductions of 34% and 32%, respectively.

Experts, including those quoted by The Dawn, have identified record-high imports of cotton as a primary factor exacerbating the crisis. The reliance on international markets has undercut local demand, worsening the plight of domestic growers and ginners.

Textile Mills and Exports Decline

Adding to the distress, the textile industry has significantly reduced its cotton purchases, buying just 4.7 million bales so far—a 34% decrease from the previous year. Export figures paint an even grimmer picture, with cotton exports plummeting by 84% to just 46,300 bales during the same period.

The chairman of the Cotton Ginners Forum, Ihsanul Haq, highlighted the paradoxical situation where, despite the sharp production drop, ginning factories still hold approximately 6.14 million bales of unsold cotton. This surplus, coupled with reduced buying, is further driving down prices and creating a bottleneck in the supply chain.

Implications for Local Growers

The combination of reduced production, diminished demand, and falling prices has left local cotton growers struggling to make ends meet. Many are unable to recover their input costs, forcing some to consider switching to alternative crops or abandoning cotton farming altogether.

Calls for Policy Intervention

Industry stakeholders are urging the government to address the crisis by reducing cotton imports and implementing measures to support local growers. A robust policy framework could help stabilize prices, incentivize local production, and ensure a sustainable future for Pakistan’s cotton sector.

A Critical Juncture for the Cotton Industry

The current state of Pakistan’s cotton industry underscores the need for immediate action. Without strategic intervention, the crisis risks long-term damage to one of the country’s most vital agricultural and economic sectors.