Tajik cotton producers claim losses due to falling demand in Russia, following sanctions imposed on that country.
This year’s cotton harvest in southern Tajikistan far exceeded last year’s result. Although, in general, world cotton prices have increased slightly, farmers complain of significant losses.
Experts say cotton is the second most important sector of Tajikistan’s economy after aluminium. Khalilzoda Qudbiddin, deputy head of the Khatlon Region Agriculture Department, said that 250,000 hectares of cotton have been planted in the Khatlon Region this ye is 50,000 hectares more than last year.
Khosiyat Hasanmurodova, 57, a resident of Dusti district, has been working as a cotton picker for the past ten years.
She said that cotton harvesting is usually a good income for villagers.
“This year they are paying us one somoni per kilogramme of cotton harvested (as in previous years), if we harvest 100 kilogrammes of cotton per day, that’s 100 somonis, almost 10 US dollars. The harvest of cotton this year is good,” she said.
Other cotton pickers in the Khatlon region also report a large cotton harvest. At the same time, however, farm managers say that cotton prices have decreased.
Nematullo Rajabov, head of the Dubeda farm in Abdurahmoni Jomi District, which grows cotton on 20 hectares of land, is seriously concerned about the fall in the price of his product.
While last year farmers sold a kilogramme of raw cotton to export companies for 12 to 13 somonis (US $1.2), this year it has dropped to 6 somonis (US $0.55).”The price of cotton has fallen, and this year we won’t be able to make a profit, we won’t be able to repay the loans we took from the bank to plant and grow cotton,” Rajabov said.
Dozens of farmers in southern Tajikistan report high yields, but like Nematullo Rajabov, they are all concerned about falling prices for the raw material.
Khatlon region is one of the largest agrarian regions of Tajikistan. In Abdurakhmoni Jomi district alone, about eight thousand hectares of land were sown with cotton this year. Six large companies buy cotton from farmers in this district.
Bozorgul Rasulova, another farmer from Nosiri Khisrav District, said she bought fuel for eight hectares of land at a high price, as well as mineral fertiliser.
“I expected to sell cotton for at least 12 somonis (US $1) like last year, but we were offered only 6 somonis (US $0.55), we won’t make any profit,” she said.
In most of the country’s cotton-growing districts, farmers are worried about low cotton prices this year. Most have taken loans from the bank and are afraid they won’t be able to repay their debts.
In Khatlon, about 50 companies buy cotton from farmers and export it once it has been processed. Representatives of these companies told CABAR.asia that last year they bought cotton from farmers at a high price, but sold it cheaply because of the fall in world prices. So this year they cannot pay farmers the same 12 somonis (US $1) per kilogramme.
One of the accountants of a cotton export company in the Khatlon region, on condition of anonymity, told CABAR.asia that their main buyer was a textile company from Moscow, but their partnership ended after the war between Russia and Ukraine began.
“When sanctions were imposed against Russia, we were told that they would not buy cotton this year as they would not be able to export the textile factory’s products. Last year there were hundreds of tonnes of raw cotton left at the factory, we hardly sold it and suffered great losses. This year we won’t buy much cotton,” our interlocutor said.
Pakhtai Osiyo (Cotton of Asia), the company that buys cotton from farmers and exports it abroad after processing, has faced major problems in the past two years.
“Russia used to buy cotton from several of our companies, but after the war with Ukraine last year it stopped buying cotton,” Safarali Nazarov said.
The company then tried to sell cotton to Turkey.
“But they didn’t buy much cotton from us either, because there was an earthquake in that city where the textile factories were located and the factories were destroyed. We went there and saw their damage, but there were no buyers. We hardly sold cotton cheaply. I don’t know if there will be a buyer this year,” Safarali Nazarov said.
Last year’s cotton had to be exported at a low price, he said.
According to Safarali Nazarov, while last year the price for one tonne of processed cotton was $2,850, today it is $1,700.
“This is certainly unprofitable for exporting companies. We cannot buy cotton from the dehkans at a high price. Buyers from Turkey have a declining economy, and Russian buyers are not interested,” he said.
Sadriddin Nazarov, an economist at Pakhtai Rushdi Khatlon (Cotton for Khatlon’s Development), said their company did not buy cotton from farmers at all last year because there were no foreign buyers.
“There were enterprises that lost two to three million somonis (about $182,500-$273,700) each because there were no buyers,” he said.
Nearly all Khatlon Region’s cotton-processing companies are concerned they will suffer. If cotton isn’t sold abroad, they won’t be able to sell it on the domestic market.
Only the Juntay-Dangara Sin Silu Textile spinning mill in Khatlon province can process cotton and produce spinning products, yarns and fabrics. This company can purchase cotton, but it is also unable to purchase the entire harvest of the region.
A report on state television said that the Juntay Dangara Sin Silu Textile Company has 14,500 hectares of land on which it grows cotton and processes it. A businessman who exports cotton said that this company rarely buys their cotton.
“The cotton the company grows is cultivated by the Chinese, it is of good quality. Sometimes they buy from us too, but now they have a lot of their stocks, they can’t buy up all the cotton that is in the companies’ hands either,” he said.
Sherali Saidov, an agricultural specialist from Bokhtar, said the goal should be to fully process cotton domestically instead of exporting it.
Only one company in the Khatlon Region, Juntay-Dangara Sin Silu Textile, now buys cotton for processing, he said.
“It will be very favourable for farmers if they start buying cotton and making cotton products inside the country. Now we see that in the last two years, farmers have been in a desperate situation, they have no buyers or buyers are offering them very low prices. Cotton has halved in price compared to last year, and there are few foreign buyers,” he said.
Of particular concern is the lack of buyers for cotton in Khatlon Province and the drop in its price, while the price of cotton on the world market has increased slightly in 2022 due to heavy rains in India and weather changes in other cotton-growing countries.
“Perhaps our cotton is of poor quality as farmers buy fertiliser at a high price and struggle to get fuel to plough the land. We don’t have good machinery to grow cotton, all these things affect the quality of the crop,” Sherali Saidov said.