Current Market Developments:
- Cotton prices in most of the domestic spot markets have declined in the last fortnight as consumption demand from spinning mills have reduced as against steady supplies.
- As per trade sources, the small mills have reduced or stopped their production and the big ones are also cutting down production as they are not getting parity. Therefore, the price of cotton has declined in the spot markets.
- The balance stock of cotton with most of the mills is lower than last year due to fall in the domestic cotton production and there is still two months left for the arrival of the new crop. So, the prices are likely to recover in coming days in spot markets.
- The government has extended deadline to import cotton without paying import taxes until 31st October 2022 from the earlier cut-off date of 30th September 2022. However, companies might not take import deals at higher prices as the shipments will take two to three months to arrive. While the arrivals of new cotton likely to start September, therefore importing at the current prices can be risky.
- According to the Ministry of Agriculture, Cotton has been sown in 6.50 lakh hectares and 2.48 lakh hectares in Haryana and Punjab respectively in the current Kharif season so far, which is less than 6.88 lakh hectares and 2.54 lakh hectares respectively over the same period last year.
- Similarly, in Gujarat one of the major Cotton growing state reported only 15.56 lakh hectares acreage under current season which is 6 percent lower than last year’s 16.50 lakh hectares. In Telangana and Andhra Pradesh also cotton acreage remained lower at 12.98 lakh hectares and 0.84 lakh hectares respectively as compared to 13.73 lakh hectares and 0.74 lakh hectares same period last year.
Cotton Price Movement Vs Seasonality at Key Markets
Domestic Cotton Supply & Demand Scenario
Global Cotton Supply & Demand Scenario
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