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Pakistan is Now India’s Top Cotton Customer

Pakistan’s loss is India’s gain.

Widespread whitefly damage to cotton crops in Pakistan could result in production levels falling to an 18-year low in 2015/16, the latest projection from the U.S. Department of Agriculture (USDA) said, while the International Cotton Advisory Committee (ICAC) predicted the country’s average annual yield would fall by 22 percent to 637 kilograms per hectare.

But the pest problem has already had an impact. Numbers compiled by the textile commissioner’s office and published by Business Standard show that Pakistan imported 1.66 million bales of cotton (at 170 kilograms apiece) from India during the October-December 2015 quarter, overtaking Bangladesh as the country’s number one customer.

That was nearly half of India’s total fiber exports of 3.52 million bales. By comparison, Pakistan imported just 380,000 bales from the country in the same period the previous year.

As a result, India’s textile ministry has upgraded its cotton export guidance to 7 million bales for the 2015/16 season—21 percent more than last year’s 5.77 million bales.

“The prevailing trend in cotton exports is likely to continue for the rest of the year due to crop damage in Pakistan. India’s cotton exports to other countries are also likely to remain significantly up this year,” textiles commissioner Kavita Gupta said Tuesday, noting that a third of Pakistan’s cotton crop has been damaged, which has forced the country’s mills to up their imports to meet their consumption demand.

But Pakistan isn’t the only place having cotton issues. The USDA projected that production would plunge by more than 2 million bales to 101.6 million bales worldwide last month, compared with December, based on updated harvest reports from Pakistan, China, India and Turkmenistan. In addition, the department pointed out that global consumption would be cut by 450,000 bales to 110.9 million bales.