In the 2009-2010 season Egypt cultivated no more than 390,000 feddans (acres) of cotton compared with, for example, 750,000 feddans in 2002.
The privatisation policy was a curse to the Egyptian economy. Since launching it in 1992, the state started, not only to give up some of its profitable industrial institutions to the private sector but also to stop pumping any investments into the Textile and Weaving Industry.
In the opinion of many experts this ended in the deterioration of this strategic industry, which occurred together with a sharp drop in the cotton crop to reach its lowest level in 2009.
“In the 2009-2010 season Egypt cultivated no more than 390,000 feddans (acres) of cotton compared with, for example, 750,000 feddans in 2002.
Ironically, this past year, Egypt has suffered a double loss. It has sustained lowered production of cotton, at a time when the world market was in bad need of any rise in production, due to a sharp decrease in the crop in India and Pakistan because of the catastrophic floods.
Additionally, the cotton price has soared in such a way as to harm the local textile and weaving industry, which cannot purchase then yarn it needs for the production of garments and cloth," Hussain Yehya, Chairman of the Council of Cotton, Fibres and Oil Crops, told The Egyptian Gazette.
"Following the revolution, the Government encouraged the farmers to plant a greater area of cotton to end with 3.6 million kantar (a kantar is equivalent to 160 kilograms of cotton) of pure yarn, one million more than last year's crop.
“However, this rise come in a year when the world price of cotton has dropped, which has discouraged the cotton trading companies from purchasing the crop from the farmers," Dr Yehya added.
Some weeks ago, Delta governorates’ farmers, who had failed to sell their crop, threatened the Government that they would throw their cotton sacks on the highway to block it if the Government did not speedily find a solution to their problem.
As a result, Prime Minister Kamal el-Ganzouri resorted to the Principal Bank for Development and Agricultural Credit to provide some LE500 million to subsidise the cotton trade companies to purchase the cotton from the farmers at an incentive price.
"This is not the solution; the government cannot continue offering subsidies to the trade companies to purchase the crop from the farmers at good price," commented Mohamed Abdul Rahman, Chairman of the Yarns Research Section at Al-Azhar University's Faculty of Agriculture.
In his opinion, the solution is to create a ‘fund for cotton price balance’, in which different parties benefiting from the cotton cultivation, industry and trade contribute with some shares so that they can offer price differences to the farmers.
"When the world prices fall, the difference would be paid to the farmers and when prices rise, the surplus would be added to the fund," he explained.
"What is more important now is to realise that solving cotton’s repeated problems should be approached with a wider vision, considering its three main aspects: cultivation, trade and industry," said Dr Abdul Rahman.
"Concerning the agricultural dimension, the cultivation of cotton faces the problem of competition with the world production and price, together with the high cost of the fertilisers and pesticides, as well as the competition of other crops such as rice and maize, which prove more profitable for farmers."
Dr Abdul Rahman also blamed the Egyptian research centres for not introducing new studies to help enhance the land productivity of Egypt’s famed long-staple cotton. Although admitting its prestigious position in the world market, Dr Abdul Rahman suggests enhancing cultivation of the short- and medium-staple cotton, instead of the long staple, mainly in the governorates of Upper Egypt.
"One of the many advantages of the short-staple cotton is its limited cycle of cultivation, that is four months in length, after which the farmers could cultivate their land with wheat, which Egypt badly needs," he stated, in support of his idea. This would offer a solution to the second problem caused by the decrease in cotton cultivation, namely the shortage of yarns needed for the local textile and weaving industry.
“Long years of governmental neglect of this important industry ended in its machines deteriorating, which then became incapable of dealing with the fine long-staple cotton yarns. Additionally, unable to cope with the high prices of the local cotton, these factories resorted to imported short-staple cotton and yarn in their different production of ready-made garments and other cotton wear."
Thus, cultivating wider spaces of short-staple cotton, in Dr Abdul Rahman’s opinion, could be the magic wand to solve the problems of the textile and weaving industry. He noted that 90 per cent of these factories rely on the thick yarns produced by the short-staple cotton, forcing them to import around 150,000 tonnes of cotton every year, when Egypt now exports no more than 65,000 of its long-staple cotton to the world.
"In all of Upper Egypt, there is not a single company for cotton ginning or a textile and weaving factory. Such labour-intensive industries could be enough to solve the chronic unemployment problem in the south of Egypt, " Dr Abdul Rahman argued.
He believes that the Egyptian cotton or the so-called White Gold could be the development engine for Egypt in the period ahead. "All that we need is to adopt a comprehensive strategy for developing cotton cultivation, industry and trade just as Turkey did.
"In the 1980s, Turkey's economy was in a terrible condition, whereupon the country decided to implement a vast development process based on the cultivation of cotton. It was accompanied by upgrading all its affiliated industries to finally end up with exporting eight times the amount Egypt exports today of its exceptional long-staple cotton."
"This is what Mohamed Ali pasha did at the beginning of the 19th century, when he focused on cultivation of cotton within the context of his huge development project for Egypt.
"Instead of subsidising the foreign farmers by importing around 90 per cent of our yarns from abroad, the Government should offer many measures to subsidise Egypt’s farmers and local industry," Abdul Rahman said. In agreement with this opinion, Dr Yahya calls for upgrading the textile and weaving industry to enhance the economic value of Egypt's production of cotton.
"Why continue focusing on exporting cotton as raw material or yarns while we can gain much more money and solve the unemployment problem by boosting different industries related to this strategic crop?” he asked.
"In addition to its use in woven and ready-made clothes, the cotton crop used to meet Egypt's consumption of edible oil. However, the sharp decrease in its cultivation ended with importing some 95 per cent of Egypt's need of edible oil," Dr Yehya noted, adding that cotton cultivation could also solve part of the problem of producing sufficient cattle fodder.
He believes that the Government should mainly provide different means of subsidies, such as offering free tilling of the land, subsidised fertilisers and pesticides to encourage farmers to expand their cultivation of cotton instead of growing the rice and maize that are more profitable to them now.
Dr Yehya also agrees with Dr Abdul Rahman in the importance of creating a ‘fund for cotton price balance” to cope with the problem of the world price of the crop.
In the opinion of many experts this ended in the deterioration of this strategic industry, which occurred together with a sharp drop in the cotton crop to reach its lowest level in 2009.
“In the 2009-2010 season Egypt cultivated no more than 390,000 feddans (acres) of cotton compared with, for example, 750,000 feddans in 2002.
Ironically, this past year, Egypt has suffered a double loss. It has sustained lowered production of cotton, at a time when the world market was in bad need of any rise in production, due to a sharp decrease in the crop in India and Pakistan because of the catastrophic floods.
Additionally, the cotton price has soared in such a way as to harm the local textile and weaving industry, which cannot purchase then yarn it needs for the production of garments and cloth," Hussain Yehya, Chairman of the Council of Cotton, Fibres and Oil Crops, told The Egyptian Gazette.
"Following the revolution, the Government encouraged the farmers to plant a greater area of cotton to end with 3.6 million kantar (a kantar is equivalent to 160 kilograms of cotton) of pure yarn, one million more than last year's crop.
“However, this rise come in a year when the world price of cotton has dropped, which has discouraged the cotton trading companies from purchasing the crop from the farmers," Dr Yehya added.
Some weeks ago, Delta governorates’ farmers, who had failed to sell their crop, threatened the Government that they would throw their cotton sacks on the highway to block it if the Government did not speedily find a solution to their problem.
As a result, Prime Minister Kamal el-Ganzouri resorted to the Principal Bank for Development and Agricultural Credit to provide some LE500 million to subsidise the cotton trade companies to purchase the cotton from the farmers at an incentive price.
"This is not the solution; the government cannot continue offering subsidies to the trade companies to purchase the crop from the farmers at good price," commented Mohamed Abdul Rahman, Chairman of the Yarns Research Section at Al-Azhar University's Faculty of Agriculture.
In his opinion, the solution is to create a ‘fund for cotton price balance’, in which different parties benefiting from the cotton cultivation, industry and trade contribute with some shares so that they can offer price differences to the farmers.
"When the world prices fall, the difference would be paid to the farmers and when prices rise, the surplus would be added to the fund," he explained.
"What is more important now is to realise that solving cotton’s repeated problems should be approached with a wider vision, considering its three main aspects: cultivation, trade and industry," said Dr Abdul Rahman.
"Concerning the agricultural dimension, the cultivation of cotton faces the problem of competition with the world production and price, together with the high cost of the fertilisers and pesticides, as well as the competition of other crops such as rice and maize, which prove more profitable for farmers."
Dr Abdul Rahman also blamed the Egyptian research centres for not introducing new studies to help enhance the land productivity of Egypt’s famed long-staple cotton. Although admitting its prestigious position in the world market, Dr Abdul Rahman suggests enhancing cultivation of the short- and medium-staple cotton, instead of the long staple, mainly in the governorates of Upper Egypt.
"One of the many advantages of the short-staple cotton is its limited cycle of cultivation, that is four months in length, after which the farmers could cultivate their land with wheat, which Egypt badly needs," he stated, in support of his idea. This would offer a solution to the second problem caused by the decrease in cotton cultivation, namely the shortage of yarns needed for the local textile and weaving industry.
“Long years of governmental neglect of this important industry ended in its machines deteriorating, which then became incapable of dealing with the fine long-staple cotton yarns. Additionally, unable to cope with the high prices of the local cotton, these factories resorted to imported short-staple cotton and yarn in their different production of ready-made garments and other cotton wear."
Thus, cultivating wider spaces of short-staple cotton, in Dr Abdul Rahman’s opinion, could be the magic wand to solve the problems of the textile and weaving industry. He noted that 90 per cent of these factories rely on the thick yarns produced by the short-staple cotton, forcing them to import around 150,000 tonnes of cotton every year, when Egypt now exports no more than 65,000 of its long-staple cotton to the world.
"In all of Upper Egypt, there is not a single company for cotton ginning or a textile and weaving factory. Such labour-intensive industries could be enough to solve the chronic unemployment problem in the south of Egypt, " Dr Abdul Rahman argued.
He believes that the Egyptian cotton or the so-called White Gold could be the development engine for Egypt in the period ahead. "All that we need is to adopt a comprehensive strategy for developing cotton cultivation, industry and trade just as Turkey did.
"In the 1980s, Turkey's economy was in a terrible condition, whereupon the country decided to implement a vast development process based on the cultivation of cotton. It was accompanied by upgrading all its affiliated industries to finally end up with exporting eight times the amount Egypt exports today of its exceptional long-staple cotton."
"This is what Mohamed Ali pasha did at the beginning of the 19th century, when he focused on cultivation of cotton within the context of his huge development project for Egypt.
"Instead of subsidising the foreign farmers by importing around 90 per cent of our yarns from abroad, the Government should offer many measures to subsidise Egypt’s farmers and local industry," Abdul Rahman said. In agreement with this opinion, Dr Yahya calls for upgrading the textile and weaving industry to enhance the economic value of Egypt's production of cotton.
"Why continue focusing on exporting cotton as raw material or yarns while we can gain much more money and solve the unemployment problem by boosting different industries related to this strategic crop?” he asked.
"In addition to its use in woven and ready-made clothes, the cotton crop used to meet Egypt's consumption of edible oil. However, the sharp decrease in its cultivation ended with importing some 95 per cent of Egypt's need of edible oil," Dr Yehya noted, adding that cotton cultivation could also solve part of the problem of producing sufficient cattle fodder.
He believes that the Government should mainly provide different means of subsidies, such as offering free tilling of the land, subsidised fertilisers and pesticides to encourage farmers to expand their cultivation of cotton instead of growing the rice and maize that are more profitable to them now.
Dr Yehya also agrees with Dr Abdul Rahman in the importance of creating a ‘fund for cotton price balance” to cope with the problem of the world price of the crop.
