“Figures released by the US Department of Agriculture (USDA) indicate
that the country harvested 49,000 bales of cotton this year, a 113 per
cent rise over the 23,000 bales harvested last year. ” “..
This is the industry’s third best performance in the last 30 years —
after the 62,000 bales recorded in 1979 and the 60,000 bales recorded in
1984 — but falls short of the 58,000 bales that the Cotton Development
Authority had projected this year. ” “..
This level of production means reliance on imports dropped from 88.7 per cent last year to 72.8 per cent this year. ” “..
“A lot of campaigns have gone towards promoting cotton development this
year and they are beginning to bear fruits,” said Mr David Masika, the
chairman of Kenya Ginners Association. ” “..
Major distributors and retailers of cotton related items like school
uniforms, bed sheets, and towels however said they have been forced to
increase prices by between 10 per cent and 25 citing similar moves by
manufacturers who have blamed the trend on rising international prices. ” “..
Parents of children returning to school have complained of higher uniform prices. ” “..
“The price at which I replaced my son’s shirt and one pair of shorts is
10 per cent higher compared to prices at which I bought the same items
in August,” said Ms Mary Ambasa, who buys her items at KAWA uniform
outlet in Buru Buru, Nairobi.
” “..
This year, international prices of cotton lint have risen to as high as
Sh302.40 ($3.78) per kilogramme, about Sh54, 432 per bale. ” “..
This is much higher than the prevailing minimum price threshold of Sh32
per kilogramme of seed cotton (translating to Sh96 per kilogramme of
lint cotton or Sh17,280 per bale) that the government fixed for the
local market two months ago. ” “..
Local farmers have been threatening to look for alternative markets for
their produce if the government (the main buyer) fails to raise minimum
prices, while manufacturers’ high prices will make their products less
competitive in the liberalised domestic market. ” “..
A meeting held last month between industry players on one side and the
government represented by Agriculture and Industrialisation ministries
on the other failed to resolve the pricing row in the sector.
” “..
Sunflag textile and Knitwear Mills general manager Harrison Kinuthia
said improved harvests have been watered down by reduced supply in the
international market, making it impossible to pass price advantage to
the final consumer. ” “..
Plug shortfall” “.
“Price for raw cotton constitutes 70 per cent of our ex-factory price
for cotton fabrics, this means retail prices for our items will continue
to rise as long as we also have to buy cotton at higher prices,” Mr
Kinuthia told the Business Daily on Wednesday.
..
The Cotton Development Authority (CODA) estimates that the country’s annual domestic consumption of cotton at 180,000 bales. ” “..
This means that even at the current improved harvests, local textile
firms still have to import at least 131,000 bales to feed their mills. ” “..
The local firms had expected to use the free trade regime in the East
African Community to plug the shortfall with imports from Uganda and
Tanzania.
” “..
Under its own projections for this year, CODA expected Tanzania to produce 700,000 bales with Uganda producing 250,000 bales. ” “..
According to the USDA report, Tanzania produced less than half the
projection, harvesting only 300,000 bales this year while Uganda’s
harvests dropped by 30 per cent to 140,000 bales. ” “..
When harvesting began in the country in October, CODA moved swiftly to
ban exports of cotton saying some cross border middlemen were taking
advantage of the harvesting season glut to buy cheaply from Kenya for
hoarding purposes. ” “..
Not worked” “.
“Unfortunately, all these calculations have not worked for us and like
other producers worldwide, we are directly exposed to volatile
international prices,” said Mr Kinuthia. ..
The recent floods that destroyed crops in Pakistan, the leading global
exporter of cotton, have sparked global price rallies with countries
such as China and India increasing their uptake of available stocks to
boost domestic reserves.
” ”
Date:12/30/2010
Source:www.commodityonline.com