According to domestic news in Pakistan, affected by the reduced supply of improved seeds in 2020, the successive attacks of pests and diseases, and the outbreak of the new coronavirus pneumonia epidemic, Pakistan’s cotton planting area fell by nearly 20% year-on-year in 2020. At the same time, some cotton areas in Pakistan have continued to experience rainfall and high temperatures since late July, which will have a greater impact on the output and quality of new cotton in 2020/21. Some international cotton merchants, Pakistani cotton textile mills and cotton traders have judged that 2020 The annual gap between Pakistan’s domestic cotton supply and demand has increased significantly compared with the previous year, and it is necessary to sign contracts in advance to purchase cargo from other origins to fill the raw material gap.
According to the latest USDA report, Pakistan’s cotton production and consumption in 2020/21 were 1.415 million tons and 2.177 million tons respectively, with a production-consumption gap of 762,000 tons. According to information from the Pakistani authorities, as of the end of August, Pakistan’s domestic textile industry has recovered rapidly and comprehensively, with textile and garment factories approaching full capacity. Textile and apparel exports in July increased by 14.4% year-on-year (exports and shipments to China grew significantly). Therefore, Pakistan’s cotton consumption demand in 2020/21 is worth looking forward to.
Due to the escalation of conflicts between India and Pakistan and the continuous military conflicts, it is unlikely that Pakistani cotton textile mills/traders will make large-scale inquiries and purchase Indian cotton in 2019/20 and 2020/21. The epidemic continues to be out of control, India’s domestic economy has plummeted, and coupled with the instigation of the United States, India’s confrontation and playing with fire with neighboring countries such as Pakistan, China, and Nepal will continue unabated. Therefore, Pakistani buyers focus on inquiries and purchases. Focusing on medium and low quality Brazilian cotton, medium and low quality American cotton, Central Asian cotton (mainly Uzbek cotton) and African cotton with outstanding cost performance.
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