Pakistan Exports Drop by 67% (That’s a Good Thing)
August 6, 2013 
Normally, when a major exporting country’s cotton shipments fall off by two thirds in a single year, it’s due to a weather catastrophe or a government mandate. A drop from $462 million in exports one year to $154 million the next might sound like a disastrous situation, and while Pakistan has unfortunately fallen victim to its share of environmental problems in recent years (leaf curl virus, massive flooding), the 67% drop in its cotton exports was actually a positive thing for its merchants.
With mill demand high and supply low, Pakistani traders were able to get domestic rates of about 80 cents per pound – as good or even better than those in the international marketplace. As a result, ginners and merchants simply bypassed the cost and time associated with the export process and delivered directly to local spinning mills.
That having been said, the news wasn’t all positive. Other factors that figured into the decrease in exports include a smaller-than-expected crop (about 13 million bales vs. estimates of 14 million) and lower quality due to excessive trash in the fiber, according to The Business Reporter. And mills need more than the local suppliers can provide, with consumption expected to reach 15 million to 16 million bales – several million more than Pakistan’s entire crop this year.
The full story can be found here.
GET THE NEWSLETTER TODAY!
