November 6, 2020 2:19:19 am
Indian cotton traders are hopeful of increased exports due to a possible downward revision in the crop’s production in the US and Pakistan. Pradeep Jain, founder and president of the Khandesh Cotton Gin/ Press Owners and Traders Development Association, has projected exports of 6.5 million bales of cotton, weighing 170 kilogramme (kg) each, for the 2020-’ 21 cotton year between October and September.
Drought in the main cotton producing zones and damage to the crop due to multiple hurricanes in the US has seen its production’s figure being corrected from the 17.06 million bales in September, 480 pounds each, to 17.05 million bales in October. This is a sharp fall from the 19.91 million bales that the world’s largest producer had produced last year. Crop projection in Pakistan, another significant cotton producing country, has been bad due to drought and locust attacks on the crop last year.
Jain told The Indian Express that India’s cotton now enjoys price parity, which has made Indian traders look for newer and better exports. “The price of Indian cotton is now priced at Rs 40,000 per candy (355.62 kg) as compared to Rs 42,000 per candy in international markets. The price parity will help us reach newer markets,” he said.
During the last cotton marketing season, India had reported exports of 4.5 million bales of cotton and the expectations of this season are 6.5 million bales.
Other than the traditional markets such as Bangladesh and China, traders are also eyeing markets like Turkey, Vietnam and Indonesia for exports. A per industry estimates, between 10 and 12 lakh bales of the lint left Indian shores in October alone. Jain also brought up a correction in India’s domestic production from the earlier 40 million bales to the present 36 million bales. “Reports of pink bollworm infestation and crop damage due to rains have hinted at a lower production,” he added.
At present, cotton arrival in wholesale markets continues to remain stressed and the prices have been steady. Farmer are now getting paid at the rate of Rs 5,000 – Rs 5,200 per quintal for their seed cotton at the gin gate. “Most farmers are waiting for Cotton Corporation of India’s (CCI) procurement centers to start operations in full swing. Prices will remain steady,” he said.
The CCI’s operations have already started in the northern portion of the country, with the government body reporting procurement of around eight lakh bales of cotton. Last season, the CCI had created history by procuring over 10 million bales of cotton and this season, a similar procurement is expected.
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