Pulses Stuck, Flour Prices, Tractor Industry, Dissolution of Punjab Assembly & Sindh Local Elections, Forex Reserves.

TOPLINE

• Traders held a protest outside the State Bank’s head office against the no-clearance of over 6,000 containers of pulses at the port for the past 2 months.
• Flour would be supplied across the province at Rs 118 to Rs 95 per kg. In Lahore, tandoor owners staged a protest outside the civil secretariat, demanding revisions in the naan and roti prices.
• Prolonged delay in sales tax refunds has forced the tractor industry to suspend operations as at least 300 SMEs, rendering about 100,000 workers jobless.
• Fawad Chaudhry has announced that Punjab CM Parvez Elahi has signed the summary for the dissolution of the Punjab Assembly, while the Sindh govt announced that the local elections scheduled for January 15, 2023 will not be held in Karachi, Hyderabad and Dadu.
• Pakistan’s Forex reserves dropped $1.2 billion to $4.3 billion as of January 6, leaving the country with barely 3 weeks’ worth of import cover. While, banks have exhibited a growth of 7.4% in financing to the private sector rising to Rs 11.91 trillion.

COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE

• Pulses Crisis Emerging: Prices of pulses are going up, thanks to the non-clearance of imported consignments at the port due to a delay in the approval of relevant documents by banks. Karachi Wholesalers Grocers Association (KWGA) chairman Rauf Ibrahim said the traders held a protest outside the State Bank’s head office on Thursday against the no-clearance of over 6,000 containers of pulses at the port for the past two months on account of dollar shortage and banks’ reluctance in approval of import documents. [Dawn]
• Cotton Export: Rs 34.1 billion was the export value of cotton in Nov 2022. Down 3.68% compared to Rs 35.4 billion in Nov 2023. According to the PBS. [ET]
• Textile Exports: At a time of increased focus on giving a boost to Pakistan’s exports to earn more foreign exchange, the performance of the textile sector has remained unimpressive in international markets, where exports of textile goods decreased by 17% year-on-year to $1.35 billion in December 2022. [ET] [ET]
• Imported Cotton Shortages: The country’s textile industry has started turning away export orders on supply chain disruptions caused by non-availability of imported cotton. [The News]
• Sugar Export: The government is to allocate sugar quota to mills for exports on the basis of their installed capacity as no sugar has been exported so far out of an already approved quantity of 100,000 MTs, well informed sources in the Commerce Ministry told Business Recorder. [BR]
• Flour Price: The flour mills of Sindh have announced flour would be supplied across the province at Rs 118 to Rs 95 per kilogrammes. [ET]
• Protest Rising Flour Prices: In Lahore a number of tandoor owners staged a protest rally on Thursday outside the civil secretariat against the rising prices of simple and fine flour and demanded revisions in the naan and roti prices in line with the ongoing price hike. [Dawn]

AGRI-INPUTS, WEATHER, WATER & POWER

• Dams Construction Funds: The Supreme Court was informed on Thursday that various factors, including recent floods and Covid-19, delayed the construction of the Mohmand and Diamer-Bhasha dams for at least nine months to a year. [Dawn] [ET]
• Tractor Parts Maker Plants: A prolonged delay in sales tax refunds has forced the tractor industry to suspend operations as at least 300 small and medium enterprises (SMEs) manufacturing tractor parts have shut down, rendering about 100,000 workers jobless. [ET]
• Gwadar Port: The Gwadar port on Thursday started receiving government imports of bulk cargo as three vessels carrying 90,000MT urea arrived at the port and clocked the fastest discharge rate. [ET]

AGRI UPDATES & PAKISTAN POLICY

• UAE Loan: The United Arab Emirates agreed on Thursday to lend $1 billion to Pakistan and roll over an existing $2 billion loan, information minister Marriyum Aurangzeb said, offering some respite to a nation still reeling from devastating floods. [BR] [ET]
• Dissolution of Punjab Assembly: Pakistan Tehreek-e-Insaf (PTI) Senior Vice President Fawad Chaudhry has announced that Punjab Chief Minister Parvez Elahi has signed the summary for the dissolution of the Punjab Assembly, which would be sent to Punjab Governor Muhammad Baligh-ur-Rehman for his consent. [BR] [ET]
• Punjab Political Chessboard: PTI Chairman Imran Khan has emerged victorious as Punjab Chief Minister Parvez Elahi has signed a summary for the dissolution of the provincial assembly as per his desire. [ET]
• LG Polls: In a major development, the Sindh government announced on late Thursday night that the local government elections scheduled for January 15, 2023 will not be held in Karachi, Hyderabad and Dadu. However, elections will be held in the remaining districts of Sindh as per the election schedule announced by the Election Commission of Pakistan (ECP). [BR] [Dawn] [Dunya]
• MQM-P Reunifies: Pak Sarzameen Party (PSP) Chairman Syed Mustafa Kamal and MQM Organisation Restoration Committee founder Dr Farooq Sattar on Thursday buried the hatchet and announced rejoining the MQM-Pakistan to “jointly raise voice for the rights of the people of urban areas of Sindh”. [ET]
• Foreign Exchange Reserves: Pakistan’s foreign exchange reserves dropped $1.2 billion to $4.3 billion as of January 6, the central bank said on Thursday, leaving the country with barely three weeks’ worth of import cover. [BR] [Dawn] [ET] [ARY]
• Private Financing: Banks have exhibited a surprisingly notable growth of 7.4% in financing to the private sector (called advances) rising to Rs 11.91 trillion at a time when businesses are closing operations due to economic hardship in the country. [ET]

INTERNATIONAL – OVERVIEW & MARKET OUTLOOK

• Oil Prices: Oil prices slipped in early trade on Friday but were on track for gains of more than 6% for the week on solid signs of demand growth in top crude-oil importer China and expectations of less aggressive interest rate rises in the United States. Brent crude futures had fallen 33 cents, or 0.4%, to $83.70 a barrel by 0322 GMT, while US West Texas Intermediate (WTI) crude futures slipped 20 cents, or 0.3%, to $78.19. [BR] [ARY]
• US Smaller Hikes: The Federal Reserve is on track to downshift to smaller interest-rate increases following a further cooling in US inflation, though it’s likely to keep hiking until price pressures show more definitive signs of slowing. Consumer prices rose 6.5% in the 12 months through December, marking the slowest inflation rate in more than a year. Investors seized on the numbers as a sign that the Fed would dial down the pace of its tightening campaign. [Bloomberg]
• Own Uranium for N-Project: Saudi Arabia plans to use its own uranium resources to develop the kingdom's civilian nuclear programme, its energy minister said on Wednesday. [BARRON’S] [ET]
• Palm Oil Exports: Malaysia said on Thursday it could stop exporting palm oil to the European Union in response to a new EU law aimed at protecting forests by strictly regulating sale of the product. [ET]

PAKISTAN - REMAINDERS

• Opinion: Can Climate Threat Prompt Cooperation in South Asia? - “Climate change has justifiably been described as an existential threat to humanity. Varied climate-related impacts have already made life miserable for a large proportion of people living within poorer countries. Climate-induced changes are also exerting major pressure on natural resources shared across contested political borders.” - By Syed Mohammad Ali [ET]