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EGYPTIAN COTTONAnd its position among the world cotton By Agricultural Consultant

Nabil El Santaricy

Chairman of Alexandria Cotton Exporters' Association (ALCOTEXA). Managing Director of (ALKAN) Mohamed Mahmoud NossierCo. Boar

dofDirectorsMemberofCottonArbitrationandTestingGeneral Organization (CATGO).

MemberofCottonPricingCommittee(MinistryofAgriculture). MemberofHigherCouncilofTextileIndustries. MemberofMonitoring, Verification

andEvaluationUnitAgricultural Policy Reform Program (Sponsored by United States Agency for International development/Cairo).

EX-Consultant and Expert for InsuranceCompanies. EX-Consultant for two of Cotton TradingCos.

Alexandria /1stofAugust 2018

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Egyptian cotton and its position among the world cotton

ForCenturiesEgyptianCottonhasbeenconsideredthebestintheworld,whenwe talk about Egyptian cotton we talk about the white gold, which is the best and finest cotton all over the world, Egyptian cotton combines between length, strength and fineness in addition to uniformity index, as Egyptian cotton is considered the highest uniformityamongtheworldcotton,aswellaslownepsratiobecauseofthehandpicking and roller gin which put less stress on the fibers and this is one of the most important features of Egyptiancotton.

Thisuniquenessnotcomebycoincidence,itisresultoflongyearsofworktoproduce excellent cotton varieties and new breeds continually, all thanks to the efforts of the scientists and researchers of Cotton Research Institute in Giza which has been established in the early of the last century, even before the establishment of Egyptian MinistryofAgriculture.Researchers'effortswerenotsufficienttoproducesuchvarieties withoutsuitableenvironmentalandclimateconditions,asELSvarietiesarecultivatedin North Delta of the River Nile which coming from the depth of Africa & Boarded by the southern coast of Mediterranean Sea, where sun rises for long hours during cotton growth period (April andMay).

Thesunrisehelpsinprecipitationofcelluloseoncottonfiberandalsofertilesoilwhere thenecessaryfactorsforgrowingcottonareprovided,thisworkstoelongatecottonfiber and staplestrength.The nearness of Cotton Cultivation areas in North Delta from the Mediterranean Sea coast and the historical natural North Delta Lakes where high humidity gives the Egyptian cotton the highest fineness.

Withreferencetothestudypresentedinthe34thInternationalConferenceofBremen Exchange, Germany (from 21 to 23rd of March 2018) for specialists in cotton field – where Bremen Cotton Exchange in collaboration with Institute of Fiber Technology prepared this study about the cultivated varieties in the world and their technical specifications, we found that ELS Egyptian cotton varieties with high strength and finenessaresuperiortotheircounterpartsofLS&ELScottoncultivatedintheproducing countries such as United States, India, China, Sudan and Turkmenistan in addition to Egypt.

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Table no. 1 showing the most important cultivated varieties in these countries and their technical specifications as presented in this study.Comparison between the most important LS and ELS varieties for the most important producing countries:Table No. 1

Variety

Country

Length mm Fineness Micronaire

Strength g/tex

Egypt Giza 96 34.40 3.6 43.5Giza 92 32.7 3.2 44.9Giza 94 32.8 3.5 42.1

China Xinjiang 38-40.9 3.6-4.2 39India Dch-32 34-36 2.7-3.4 32-35

Sudan Barakat 33-37 3.6-4.2 30-40United States Pima 34-37 3.8-4.2 42.4-43.7

Source: Bremen Exchange Report March 2018 - ICAC June2018

ELS cotton represents 2%-3% of world production and it is almost constant despite increasingofworld'spopulation,buttheuseofthemanmadefibersaccordingtothenew world fashion standards maintains stability of cottonneeds.

World ELS cotton production and its percentage (%) to world production: Table No. 2 000 Tons

Source: ICAC June 2018

10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18Extra Long Staple

Cottons630 453 34 431 417 487 480 446

TotalWorldProduction

23160 25005 24405 24322 24044 19489 21407 25973

% 3 2 2 2 2 3 3 2

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Cotton in Egypt is given special care and attention since many years and especially in the coming season 2018/2019 by many authorities and organizations representedin:

1- Cotton Research Institute which doing great efforts to breed / develop new varieties and new races on yearly basis to produce commercial varieties included in the agriculture's plan for 2018/2019 season, commercial varieties not included in the agriculture's plan and promising varieties will be included in the productionsoon.

Table no. 3: Cultivated varieties under contracting (2018/2019 season) andcommercial varieties not included in the agriculture's plan (Giza 88) / Specification average:

Varieties Color Reflectance Yellowness Micronaire Maturity Staple Length

Uniformity

Staple Strength

Elongation

Giza 45 White 73.7 8.5 3.0 0.89 35.3 88.1 45.5 6.3

Giza 87 White 73.5 9.2 3.2 0.90 36.1 86.1 47.5 6.4

Giza 88 Creamy 65.7 11.5 3.8 0.93 36.5 87.5 48.7 6.5

Giza 93 Creamy 68.5 11.3 2.9 0.88 36.7 87.5 47.4 6.4Source: Cotton Research Institute – Giza

Table no. 4: Current varieties which included in the agriculture’s plan for the coming Season 2018/2019 and promising varieties / specification average:

Varieties Color Reflectance Yellowness Micronaire Maturity Staple Length

Uniformity Staple Strength

Elongation

Giza 86 White 76.1 8.8 4.22 83 32.8 86.9 43.8 5.7Giza 94 White 77.0 9.0 3.63 77 33.9 87.3 41.8 5.5Giza 92 White 77.4 8.8 3.28 74 32.7 86.9 45.5 5.2Giza 95 Creamy 67.8 11.9 4.15 86 28.4 83.5 35.1 6.7Giza 90 Creamy 64.8 11.5 4.21 83 28.5 83.9 34.7 7.7Giza 96 White 75.9 9.1 3.54 75 34.9 87.2 44.3 5.2

Giza89x86x94

White 74.1 8.9 4.6 0.97 34.4 85.8 47.00 7.2

Giza 90xSB58

Creamy 64.8 12.7 4.00 0.93 28.9 85.00 36.7 8.00

Source: Cotton Research Institute – Giza

Table No. 5

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2- General Administration for Seed Testing and Classification which is responsible for selecting the suitable seeds for cultivation and excluding foreign seeds which is not suitable forcultivation.

3- Cotton Improvement Fund which is responsible for following up planting levels till cotton picking and selecting the foreign plants aswell.

4- General Administration of Agricultural Quarantine which is responsible for testing all Egyptian cotton shipments which export from Egypt and foreign cotton which imports to Egypt to ensure that cotton is free of seeds andpests.

5- Cotton Arbitration and Testing General Organization (CATGO), it’s one of the most important organization in the cotton business, their mission is to test the cotton and to issue the H.V.I Certificate (table no. 5), and Humidity Certificate for adjusted standard weight based on humidity percentage of (8.5%) which enables buyer to pay the real value of the purchased cotton. One of CATGO mission is to issue certificate of cotton grade prepared by committees from certified cottonexperts.It is noteworthy that there’re offices in all ginning mills & pressing factories following CATGO, their technical teams responsibilities to look after the ginning and pressing in all the operations levels.

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6- General Committee for Cotton Internal Trading, their responsibility is to organize the cotton trading between producers and traders of Seed CottonInternally.

7- Finally, Alexandria Cotton Exporters' Association (ALCOTEXA) which is one of the oldest cotton associations in the world since 1932, ALCOTEXA aims to organize the cotton trading / process between traders, exporters, importers, spinners and other parties inside or outside Egypt, ALCOTEXA role is well known to all the parties dealing in Egyptian cotton. It registers sales contracts, issues shipping orders, provides the members with a weekly reports showing weekly sales, total contracted quantities by company & country, total shipped quantities by company & country, provides clients with weekly cotton prices average. It arbitrates in disputes between sellers and buyers of Egyptian cotton and guarantees rights of Egyptian cotton clients according to the law which organizes the work ofALCOTEXA.Also, ALCOTEXA in Collaboration with Cotton Egypt Association are managing the Egyptian Cotton Logo (the Golden Seal), granting the necessary licenses and monitoring the proper use of the Egyptian Cotton Logo on products made of 100% Egyptian cotton.

Ministry of Trade and Industry is monitoring all the parties working / operating in cotton activities by hiring representatives to represent Ministry of Trade and Industry in Boards of Directors of Cotton Arbitration and Testing General Organization (CATGO), General Committee for Cotton Internal Trade and Alexandria Cotton Exporters' Association (ALCOTEXA).Because we in Egypt understand the importance of the Egyptian Cotton to Egypt and to the world, many of the governmental organizations and non-governmental organizations (as stated above) work together to promote / develop the Cotton Agriculture/IndustryinEgypttoensuretheuserssatisfactionstartingfromthespinners to the enduser.

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Table No. 6Statistical Position of Egyptian Cotton 2017/2018 Season (ton)

from beginning of the season till 02/07/2018

Variety

Beginning Stock at

2017/2018Season

Crop 2017/2018

Season (ton)

Total Supply

2017/2018Season

Distributed

Total Distribution

Remaining in 2/7/2018

Shipping 2017/2018

Season 23/6/2018

Mills Deliveries

Commitment 2017/2018Season till 23/6/2018

Export Commitment 2017/2018Season till 23/6/2018

Giza 45 8,50 6,45 14,95 1,80 10,25 12,05 2,90 9,25Giza 70 0,55 0,55 0,55Giza 87 442,25 520,95 963,20 58,20 905,00 963,20 818,20Giza 88 151,65 230,25 381,90 38,40 275,00 313,40 68,50 202,00Giza 92 229,20 1406,95 1636,15 386,30 784,50 1170,80 465,35 760,70Giza 93 1,20 1,20 1,20 1,20 1,20Giza 96 77,50 1579,30 1656,80 37,40 1454,80 1492,20 164,60 1288,80

Total Extra Long 910,85 3743,90 4654,75 522,10 3430,75 3952,85 701,90 3080,15

Giza 86 4614,45 23645,80 28260,25 9838,60 13807,50 234646,10 4614,15 9400,65Giza 94 1552,10 33797,80 35349,90 6162,40 28478,28 34640,68 709,22 21622,13

Total LowerEgypt 6166,55 57443,60 63610,15 16001,00 42285,78 58286,78 5323,37 31022,78

Giza 90 349,05 1703,50 2052,55 52,55 2000,00 2052,55 1835,00Giza 95 461,40 5974,60 6436,00 6436,00 6436,00 6063,00

Total Upper Egypt 810,45 7678,10 8488,55 52,55 8436,00 8488,55 7898,00TotalLong

Staple 6977,00 65121,70 72098,70 16053,55 50721,78 66775,33 5323,37 38920,78Total 7887,85 68865,60 76753,45 16575,65 54152,53 70728,18 6025,27 42000,93ET 1134,40 1134,40 152,00 152,00 982,40 50,00

Grand Total 7887,85 70000,00 77887,85 16575,65 54304,53 70880,18 7007,67 42050,93

1- Export commitments in accordance with ALCOTEXAfigures.2- Total distribution is calculated on the basis of (spinning mills commitments + export commitment). 3- The remaining = total supply – totaldistribution.4- Mills deliveries according to CATGO's technical office.

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Egyptian Cotton Planted Area (By Feddan)

600,000

500,000

400,000

300,000

200,000

100,000

-

(*) Estimated

Table No. 7The Target Area 2018/2019 Season

and the Expected CropType Target

Area/FeddanProduction

Average Cantar

Seed/Feddan

Expected Crop/Cantar Seed Cotton

Lint % after

Ginning

Expected Crop of Lint according to Target Area

Expected Crop of Lint/Tons

Giza 92 8,677 5.00 43,385 110 47,724 2,386Giza 96 9,092 6.00 54,552 121 66,008 3,300Giza 45 18 4.00 72 102 73 4Giza 88 6.00 0 110 0 0

Extra Long Stable Total 17,787 10.50 98,009 111 113,805 5,690

Giza 94 196,426 6.00 1,178,556 121 1,426,053 71,303Giza 86 88,175 6.00 529,050 116 613,698 30,685

Long Stable Total 284,601 6.00 1,707,606 29 2,039,751 101,988

Giza 90 5,363 5.00 26,815 120 32,178 1,609Giza 95 28,084 5.00 140,420 120 168,504 8,425

Upper Egypt Total 33,447 5.00 167,235 120 200,682 10,034

Grand Total 335,835 1,972,850 2,354,238 117,712* Based on average of last3years 7/3/2018

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Egyptian Cotton Production (By Ton)

250,000

200,000

150,000

100,000

50,000

-

(*) Estimated (**) Projected

Local Consumption of Egyptian Cotton (By Ton)

140,000

120,000

100,000

80,000

60,000

40,000

20,000

-

(*) Estimated

Egyptian Cotton Exports (By Ton)

140,000

120,000

100,000

80,000

60,000

40,000

20,000

-

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