Low opening stock and uncertainty over monsoon might keep the pressure on the wholesale prices of cotton in the upcoming days. The Cotton Association of India (CAI) has estimated 2018-19 season to report a closing stock of 13 lakh bales of 170 kg each as against the 28 lakh bales of closing stock reported for the 2017-18 season.
The CAI had revised its initial production estimates from 348 lakh bales to 315 lakh bales in view of the reported drop in production from various parts of the country. An official press release issued by the CAI shows that arrivals till the end of May 2019 is 287 lakh bales as against the arrivals of 340 lakh bales of May 2018. The total production for the last season was around 365 lakh bales.
The CAI has retained the export outlook at 46 lakh bales for the current season. Till May, the country has already seen exports of a little over 44 lakh bales. The total imports for the last season was 69 lakh bales. The October 2018-May 2019 imports for the country, the association said, was 31 lakh bales, almost double of the 15 lakh bales for the October 2017-May 2018 season.
This year, another factor for keeping up the pressure on cotton prices in the domestic markets is the uncertainty regarding the monsoon. The IMD has maintained its normal prediction for the monsoon, although the onset is to be delayed. However, trade sources say farmers will be wary of undertaking sowing operations early, which might affect the productivity in the long run.