Cottco Faces Substantial Losses as Raw Cotton Exposed to Rain
Cottco, the leading cotton financier in the country, is grappling with significant losses as a substantial amount of raw cotton has been exposed to rains, according to company sources.
The board’s decision to forgo contracting private ginners under toll ginning agreements has backfired, causing processing challenges for the entire cotton crop from the previous intake season.
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Despite owning five ginneries in various locations, operational issues hindered Cottco from processing the entire 2023 harvest, resulting in unavoidable losses, as acknowledged by a senior official speaking on condition of anonymity.
The decision to manage ginning internally aimed at reducing costs but lacked supporting measures for maintenance, staffing, and optimization across all facilities, contributing to the processing backlog.
A recent nationwide campaign urges farmers to capitalize on rains for cotton planting, but concerns over late payments and changes to input distribution have led to low uptake.
The decentralization of input distribution to Grain Marketing Board depots has posed logistical challenges for cotton growers, prompting calls for a reconsideration of the previous accessible and convenient network.
The Presidential Free Cotton Inputs Scheme, funded by the State and managed by Cottco, is designed to enhance cotton production in drought-prone regions. The initiative provides farmers with essential support, including seeds, fertilizers, chemicals, and tillage services, with the overarching goal of improving their livelihoods.