With arrivals slackening at the fag end of the season, cotton prices have firmed up by around Rs 350 to Rs 400 per quintal. According to industry experts, prices are likely to remain on the higher side with international market prices also on the rise. According to P Alli Rani, CMD, Cotton Corporation of India (CCI), cotton prices usually go up at this point in the season because of the slowdown in arrivals. According to market sources, cotton prices are around `44,000 per candy and they have been going up in the last 10 days. With more demand coming from spinning mills as well as ginners, prices are likely to remain firm.
According to Rani, so far, 320 lakh bales have arrived in the market and the season is likely to continue for another 30 days. Arrivals have slackened to 0.5 lakh bales a day and therefore the prices are up. According to cotton ginners, market sentiment is up because of speculation that demand from China is surging due to depleting buffer stock. China, earlier, had a buffer stock for one-and-a-half years and this has now reduced to a year’s stock. Exports from India, therefore, are likely to touch 75 lakh bales instead of the originally estimated 65 lakh bales, experts said.
According to market reports, the country’s 2017-18 cotton exports are likely to jump nearly 30% to a four-year high of 75 lakh bales as climbing global prices and a weaker rupee have boosted overseas demand. Higher international prices are driving up shipments, industry people said. So far, India has exported some 63 lakh bales. Last year, the country’s exports had touched some 58 lakh bales. Pakistan, Bangladesh, China and Vietnam are the main buyers of Indian fibre.
Interestingly, Bangladesh has emerged as the biggest importer of Indian cotton this season, according to industry experts. Bangladesh has imported around 21 lakh bales of cotton this season, overtaking China, which has remained the largest importer of Indian cotton until now.
The Cotton Association of India (CAI) has retained its earlier estimate of cotton crop at 360 lakh bales (each of 170 kg) for April for the season 2017-18, beginning from October 2017. The CAI has noted that around 86% of the crop has already arrived in the market by April 2018.
The apex cotton trade body has also made minor changes in the production figures for the states. The production figures for the states of Maharashtra and Karnataka are estimated to be higher by 2 lakh bales and 50,000 bales, respectively, while the production in Telangana and Andhra Pradesh are now estimated lower by 1.50 lakh bales and 1 lakh bales, respectively, thus retaining the crop at the same level as in the previous estimate made by the CAI.