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Govt intervenes by raising price of cotton

24
Dec '08
To quell the rising discontent among cotton farmers, the government of Uganda has agreed to the demands of the farmers by providing an additional Shs150 per kg over and above the Shs450 per kg they are being paid by the cotton ginners.

This response of the government has come after the cotton farmers of the country threatened to burn down their cotton farms due to unremunerative prices of cotton. This is also the first time that the government is intervening since the economy was liberalized in the 90's.

Since the beginning of the new cotton season, cotton prices have been falling with each passing month, due to the global economic meltdown and consequent slowdown in demand. The price support will continue for the whole cotton season lasting till April 2009.

The government is expected to spend Shs13.5 billion on an estimated production of 170,000 bales in the current cotton season.

Fibre2fashion News Desk - India


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