supply chain of cotton

8/7/2019 supply chain of cotton

http://slidepdf.com/reader/full/supply-chain-of-cotton 1/18

FINAL PROJECT ON SUPPLY CHAIN OF COTTON

BY PRODUCTS

SUBMITTED TO MR. IDREES AWAN

SUBMITTED BY TEHREEM ALI

ARSHIA MASOOD

USAMA BAJWA

M. SOAHAIB

BBA HONS. 7 TH SEMESTER



Supply chain management

EXECUTIVE SUMMARY

This report is about the supply chain of cotton factory. We

visited Nooshahi cotton traders. And we have focused on the

supply chain of byproducts of cotton factory. Furthermore, the

statistics and processes of ginning, pressing, oil mill are

described and the description of suppliers and buyers is also

provided.

2




Table of contents

• Introduction of Nooshahi

traders---------------4

• Product

description---------------------------------6• Suppliers---------------------------------------------

-11

• Facility-----------------------------------------------

--12

• Inventory--------------------------------------------

--13

• Transportation-------------------------------------

--14

• Customer

experience-------------------------------15

• Buyer-------------------------------------------------

---16

3




4




NOOSHAHI COTTON TRADERS

Nooshahi Cotton traders is located in khanpur and it is dealing in ginning of cotton. we have

chosen it for aou research of supply chain.

Nooshahi 's owner is Mr. Haji Faqeer Muhammad. it is working since 2001.

Nooshahi's cotton season is from august to february. during this season they perform following

activities.

• weight process

• heaping

• ginning

• pressing

• sarjan

• oil mill.

PRODUCTS OF NOOSHAHI PRODUCT TRADERS:

• Oil cake

• seed oil

• cotton bails

ORDER SIZE:

One bail is consisted of 160-170kg

200 bails per trolly

per bail cost is about Rs.48000/-

SUPPLY CHAIN STRATEGY:

The supply chain strategy used by this factory is cost effieciency. they are using cost efficient

modes of transportation and purchse material in bulk.

SUPPLIER OF NOOSHAHI COTTON TRADERS:

5




nooshahi purachses its raw material from two sources basically.

• farmers

• punjab corporation Gallahmandi

mostly purchase is done from punjab corporation. and 25% cotton is purchased directly from

farmers.

Bargaining power:

there is no bargaining power of supplier. basicallly the rates of cotton are fixed.

the inventory is purchased once in start of season of cotton.

BUYERS OF NOOSHAHI COTTON TRADERS:• Oil cake is purchased by farmers and shops. it is a finished product and it is having

manufacturer with customer pick up .

• bails are sold to textile mills

• Oil cake is purchased by ghee manufacturing mills and brick factories.

SuppliersNooshahi

traders

Retailers/

distributors

buyer

6




Supply chain of Nooshahi in by products of

cotton

WHAT IS COTTON?

Cotton, belonging to a family that includes hibiscus and okra, produces a natural vegetable fiber

used in the manufacture of cloth. Cotton produces sweet nectar that attracts a variety of

destructive insect pests, including the boll weevil, bollworm, armyworm, and the red spider. In

addition to insect pests, there is also a very destructive fungus, called the wilt that attacks the

root system of the cotton plant.

DESCRIPTION OF PRODUCT

Cotton is a major world fiber crop. It is grown under a very broad range of climates, soils

and cultural practices. Prior to the introduction of man-made artificial fibers, it was only

the raw material from which human clothing and other necessary textiles were

manufactured. Cotton is the main cash crop and Pakistan is the fourth largest cotton

producer in the world. The largest cotton producing country is China followed by USA,

India and Pakistan

However the current demand for cotton exceeds supply and Pakistan meet a part of its

raw cotton requirement through imports. It produced about 14 million bales of lint (PCGA

report) and 780 kg of lint per hectare. Cotton provides raw material to 450 textile mills,

1221 ginning factories and 5000 oil mills. Approximately 65 per cent of Pakistan's annual

export income comes from textile sector. Similarly other industries, such as

pharmaceutical, soap, chemical and feed industries also rely on cotton by-products.

Besides this, cotton is an occupation of 1.5 million farming families and provides job to

50-54 per cent of labor force. Therefore cotton is known as the life blood of Pakistan

economy.

GINNING UNITS IN RYK

There are 156 Ginning units out of which 149 unit are currently operating in the Cotton

Ginning Cluster Rahim Yar Khan.

GINNING PRODUCTION PROCESS AT RAHIM YAR KHAN

7




The cotton ginning is performed in Rahim Yar Khan between September and March.

Once harvested, seed cotton might be directly sold to the ginner, though it is generally

going through one or two middlemen’s hands before it eventually reaches the ginnery

gate. The brief production process flow of cotton ginning is as follows:

8




COTTON GINNING PRODUCTION FLOW

9




RAW MATERIALS AVAILABILITY AND REQUIREMENTS

Raw cotton is the main raw material for the ginning industry. Rahim-Yar-Khan is at the

top in production of cotton in Pakistan. Cotton is mainly raised in irrigates area on the

alluvial plains of the Indus river, sowing being performed in March-April for the Sindh

province and in May-June for the Punjab where 80% of the total crop is planted.

Harvesting is achieved from August to February.

Oil extraction

After ginning the seeds presents in cotton are separated and they are prcessed in oil extractor

mill. In which the seed oil is separated and the remaining material of sed is called seed cake.

Which is the used

as fertilizer and

also as food for

animals. It is sold

to farmers and

dairy farm persons.

10




COTTON STATISTICS OF RYK (15,02,2011)

Distric

t name

Arriva

l in

bales

Pressin

g in

bales

No.of bales sold Total

bales

sold

Stock

of

unsold

b/s

Stock

of

ungin

ned

b/s

Arrivals as

on

15.02.201

1

T.C.

P

Exporter

s

textile

s

RYK 10129

75

100697

5

0 3200 97465

7

97785

7

29118 6000 1,272,582

Source: PCGA

11




Supplier

Nooshahi mostly purchase its raw material from Punjab cooperative Gallah Mandi Khan pur.

And some of the material is purchased from the farmers. But less than 25% is purchased from

farmers. Nooshahi avoids to purchase directly from farmers as it effects their bargaining power.

In Gallah mandi the rates of cotton are fixed. And it is more near to their facility.

12




Facility

Nooshahi is having facility in khan pur . including plants and ware houses. The cost of facility is

fixed as it is their personal property and they achieve economy of scales so it don’t cost to them

so much. In facility the functions of weighing, ginning, bundling, oil extraction etc are performed

. moreover warehouse are their for storing cotton bundles and by products of cotton.

13




Inventory

Inventory cost of Nooshahi is not so high . but it can vary as the prices of raw material is

changed by the govt or current scenerios. The inventory is purchased in bulk . so the handling

cost is somewhat high. But they don’t have to put extra effort. The only threat they have is of fire

. for which they have insurances.

14




Transportation

Transportation cost varies with petrol prices. The inventory is placed close to supplier but their

customer textile mills are in gujranwala. However the customers of seed cake are local farmers.

So transportation is not a issue.

15




Response time

The response time is fast . as the product seed cake is made in anticipation of customer demands.

It is having push process.

16




Time to market

Time to market is low because very less middle men are involved. So as the seed cake is

extracted it is ready for sell.

Customer experience:

Customer experience is not so much good. As they are providing no additional services to

customers.

17




Buyers of seed cake

The remaining of seeds after extracting oil from them is called seed cake. Which is

used as food for cattles. And also as fertilizers. So farmers purchase this seed cake

for their crops and the dairy farm owners.

18

supply chain of cotton

Documents