Chinese cotton buyers are willing to purchase cotton at 80-81 cents a pound when the global prices are hovering at 78-79 cents a pound.
Notwithstanding the robust demand, Cotton Association of India expects cotton exports to fall 27 per cent to 50 lakh bales (lb) this cotton season ending September against 69 lb registered last year due to lower crop output this year.
The overall export demand is looking up with China emerging as the largest buyer. However, in its latest estimate CAI has reduced cotton output for this year to 328 lb against 330 lb estimated in January. The output was at 365 lb logged last year.
Atul Ganatra, President, Cotton Association of India said the country has supplied 5 lb to China and another 8 lb will be shipped out by April. Overall cotton exports to China is expected to touch 15 lb against 8 lb logged last year.
Chinese cotton buyers are willing to purchase cotton at 80-81 cents a pound when the global prices are hovering at 78-79 cents a pound, he said.
CAI plans to sign a memorandum of understanding with Bangladesh to enhance India’s cotton exports to that country by 30 per cent from 20 lb shipped out last year. India has shipped out 10 lb till now to Bangladesh.
Ganatra said cotton exports to Pakistan has come to standstill after the border issue. India has already exported 8 lb and already shipped out 6.5 lb and the pending orders will be fulfilled once normalcy returns.
Pakistan annual cotton crop is estimated at 330 lb but its demand is about 570 lb so it has to buy cotton from other countries, said Ganatra.
Lack of sufficient rain in states such as Gujarat, Karnataka, Telangana and Maharashtra is expected to pulled cotton crop to nine-year low this year. The previous lowest output was recorded of 305 lb was recorded in 2009.
Moreover, the government of Maharashtra and Telangana had given instructions to the farmers to remove the cotton plants by December-end to avoid Pink Ball worm problems.
Cotton Corporation of India has so far purchased 11 lakh bales as the prices at the start of season was lower than the minimum support price of Rs 41,000 a candy, said BK Mishra, former Chairman and Managing Director, Cotton Corporation of India.
Today, he added prices are hovering at 42,000 a candy and if there is any price drop below MSP then CCI will step in and these stocks will be offloaded at the end of the season, he added.
Source;BL
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