KARACHI: Cotton prices in Karachi have shown overall stability, but business activities have remained limited. The Karachi Cotton Association building has been suddenly taken into possession by the Evacuee Property Trust Board with the assistance of the Federal Investigation Agency since December 12, due to which three hundred and twenty registered cotton brokers and hundreds of tenants are extremely distressed. The affected individuals are demanding that the seal be removed and tenants be allowed to conduct business because losses worth millions of rupees are occurring on a daily basis. For the first time in the fifty-two-year history of the Karachi Cotton Association, the daily cotton spot rate has not been issued, which is of utmost importance and needs to be restored immediately. Negotiations are currently ongoing between the Evacuee Property Trust Board and the Karachi Cotton Association administration. Chairman of the All Pakistan Textile Mills Association, Kamran Arshad, stated in a television interview that permission has been granted for the import of cotton seed after fifty years, which is a positive decision. He further mentioned that a national cotton policy is also being formulated, which will prove beneficial for the industry. Cameras are now being installed for the spinning industry that is operating under extreme difficulties and unfavourable conditions, as if it were some kind of spectacle. The injustice is that the cost of these cameras is also being recovered from the mills. Syed Mudabir Shah has stated that such treatment of the spinning sector, which is already standing on the brink of destruction, is extremely inappropriate and condemnable. Cotton Expert Sajid Mehmood has stated that the experiences of China and Azerbaijan clearly demonstrate that adopting cotton as a strategic crop, establishing a strong administrative system, conducting modern research, and providing complete facilities and guaranteed profits to farmers are fundamental factors for increasing production. Pakistani farmers and industrialists can also achieve better production and higher quality by focusing their attention in the same direction and can strengthen their position in the global market. The local cotton market witnessed overall price stability for quality cotton during the past week, as cotton trading in Sindh province has been operating on a partial basis for the last two to three weeks. However, since December 12, when the Evacuee Property Trust Board, with assistance from the Federal Investigation Agency (FIA), took possession of the Karachi Cotton Exchange building, the Karachi Cotton Association has suspended the issuance of cotton spot rates for approximately 17 days and has also discontinued daily cotton trading reports. This suspension has created significant uncertainty in the market, as the actual position of ongoing transactions remains unclear. The absence of the Daily Cotton Spot Rate has particularly impacted financial institutions, with banks and insurance companies unable to determine accurate cotton rates. Banks rely on these rates when extending loans to the textile sector for cotton procurement, while insurance companies base their assessments on cotton spot rates. The cotton spot rate serves as the benchmark for determining Pakistan’s cotton prices in the global market, making its absence a critical concern for the industry. The current situation has disrupted the normal functioning of cotton trade documentation and price verification processes that are essential for the sector’s operations. The reputable English newspaper Business Recorder, in its editorial titled “Cotton Crisis” published on December 26, 2025, highlighted the importance of the Daily Cotton Spot Rate in the overall cotton trade. The editorial noted that the situation deteriorated further when a standstill occurred at the market level, transforming a difficult season into a disruptive crisis. For decades, the Karachi Cotton Association’s daily spot rate has served as the foundation for price determination. It holds fundamental importance for domestic trade, bank financing, insurance valuation, and Pakistan’s presence in global cotton markets. Its suspension, for the first time in more than half a century, is not merely a technical issue but a serious market failure that is having immediate consequences. The issuance of spot rates has been halted as a result of the sealing of the Karachi Cotton Association building by the Evacuee Property Trust Board, with the involvement of the Federal Investigation Agency, creating further uncertainty in an already pressured system. Whatever the legal aspects of the property dispute may be, the manner in which this action was carried out has caused collateral damage to the entire sector. Cotton analyst Syed Mudbir Shah has reported that implementation of the video monitoring project in spinning factories has commenced. More than two dozen major spinning factories in Faisalabad have been issued notices. According to him, cameras are being installed to observe the spectacle of the spinning industry operating under extremely difficult and unfavourable conditions. The injustice is that the money for these cameras is also being demanded from the mills themselves. This treatment of the spinning sector, which is already standing on the brink of destruction, is highly inappropriate and condemnable. Furthermore, in a television interview, Aptma Chairman Kamran Arshad stated that permission for the import of cottonseed has been granted after fifty years. He described this as a positive decision and mentioned that a National Cotton Policy is also being formulated. Cotton prices in the provinces of Sindh and Punjab ranged from 14,000 to 16,200 rupees per maund, depending on quality and payment conditions. Phutti is available in limited quantities, with prices ranging from 6,000 to 8,000 rupees per 40 kilograms according to quality. In Balochistan province, cotton prices stood at 15,500 to 16,200 rupees per maund, while seed cotton was priced between 7,800 and 8,500 rupees per 40 kilograms. The prices of cottonseed cake and oil remain generally stable. Naseem Usman, Chairman of the Karachi Cotton Brokers Forum, reported that international cotton prices are showing mixed trends, with New York cotton futures trading between 65 and 68 American cents per pound. Approximately 320 registered cotton brokers and hundreds of tenants have strongly condemned the action taken by the Evacuee Property Trust Board, with assistance from the Federal Investigation Agency, to seal the Karachi Cotton Exchange Building on December 12 with the intention of selling it. They are demanding that the seal be removed immediately and permission be granted to resume business operations. Negotiations between the Karachi Cotton Association and the Evacuee Property Trust Board should continue, as the sealing of the entire building is affecting business worth millions of rupees daily. The tenants are experiencing severe distress, and approximately five thousand people have become unemployed. Renowned cotton expert Sajid Mahmood says that cotton production in China surpassed 6.6 million tons in 2025, representing an increase of approximately 7.7 percent compared to the previous year, while Azerbaijan also achieved record production and recorded its highest average yield in history. Both countries consider cotton a strategic crop, providing farmers with full support, guidance and assured returns at every stage. Strong crop management, contract farming, quality seeds, fertilizers, machinery and technical assistance have given farmers the confidence that their efforts will not go to waste, enabling better crop care and higher yields According to the latest cotton statistics from PCGA, Pakistan’s total cotton arrivals reached approximately 5.3 million bales although provincial differences are evident. Production performed better in Sindh while some decline was observed in Punjab. The limited availability of high-quality cotton in the domestic market and the quantity supplied to the textile industry indicate that maintaining a balance between production and supply is essential. Sajid Mahmood further notes that climatic impacts and production challenges are affecting every country but the experiences of China and Azerbaijan demonstrate that adopting cotton as a strategic crop, implementing strong management, advancing research and providing farmers with full support and assured returns are fundamental factors for increasing production. Pakistani farmers and the industry can also focus in this direction to achieve higher yields and better quality, thereby strengthening their position in the global market. Copyright Business Recorder, 2025