Buying and Ginning:
During the 2007/08 marketing season, the number of cotton buyers licensed to buy and gin cotton reached 40, a 25% rise from 32 registered during the 2006/07 season. Except for Shirecu (Shinyanga Regional Cooperative Union, editor's note) no other regional cooperative union participated in cotton buying due to liquidity problems.
Due to an expected shortfall in cotton harvest, increased number of buyers and generally favourable cotton prices on the global market, stiff competition between buyers prompted the rise of producer prices from 350 Tanzanian shillings at the start of the season to a historic high of 560 shillings/kg late in the season.
Lint Exports:
By September 2007 some 13,130 tons of lint worth 16.7 million dollars had been exported to various countries but mainly in the Far East. Most cotton growing countries of Africa in general and Tanzania in particular continue to heavily depend on exports of lint for a significant part of their gross domestic product.
The Government of Tanzania, the Gatsby Charitable Foundation of the UK and the Tanzania Gatsby Trust in particular have recently been consulting and strategizing on how to revamp the cotton and textile sectors with a view to maximizing their potential contribution to the generation of increased GDP, exports, farmer incomes and manufacturing employment.
Future Outlook:
In May 2006, the Government of Tanzania reiterated its ambition to produce 1.5 million bales (271,000 tons of lint) come 2010 by raising productivity from the present average of 750 kg of seed cotton per ha (255 kg of lint) to 1,500 kg of seed cotton (850kg of lint/ha).
Several improvement actions were planned for reaching these goals, e.g. repairing streets in rural areas of the major cotton planting regions. These actions are part of the Agricultural Sector Development Program (ASDP) which has been implemented for the reorganization of the Tanzanian agricultural sector.
If climate conditions are favourable, the cotton output will possibly rise to 400,000 tons during the season 2008/09, mainly because of exceptionally high producer prices in 2007/08.
International Cotton Advisory Committee (ICAC)
marketing@alchempro.com
