The devasting floods in Pakistan could be the beginning of a new cotton crisis. An estimated 40 to 45 percent of the country’s cotton crops have been ravished by storms. This will have a disastrous effect on the world’s cotton cycle, sending prices to rocketing heights.
Pakistan is one of the world’s biggest cotton producers, the fifth largest after China, India, U.S. and Brazil, contributing 6 percent of global cotton supply. With almost two-thirds of Pakistan submerged under water, the devastation caused to people, their homes and livelihoods is catastrophic.
The heavy rains this season have also affected India’s cotton crops, while drought afflicted America’s cotton businesses. It all compounds to a shrinkage of global output, negatively impacting exportable supplies. The U.S. ban on China’s Xinjiang cotton means importing companies must prove products are free of the region’s cotton as reliance on Chinese cotton becomes evermore critical.
"Irreparable loss to the sector"
The Pakistan Tribune last week wrote of an irreparable loss to the sector and that current cotton rates reached the highest in Pakistan’s history. “Cotton consumption will also be affected due to decreased textile activities, and large quantities will have to be imported from foreign countries,” the news outlet reported. “An integrated strategy to increase the quantity of cotton crop is also essential to encourage the textile sector, already gripped in an energy crisis, to enhance production.”
In Pakistan, more than two-thirds of its people rely on agriculture, with farming reaching almost 20 percent of the country’s GDP. Cotton production has halved in the past decade, with experts citing global heating and climate change as one of the reasons. Pakistan is also a key manufacturing region for garment production. If it needs to import cotton in order to make clothing the prices of production will increase, which will disrupt the entire supply chain and ultimately impact the global high street shopper.