The prices of cotton are likely to fall further in Indian market, according to some reports published in Indian media.
Cotton sowing has already crossed the 10-million-hectare mark in the current kharif season.
In the wake of increased acreage under cotton cultivation, further correction in prices may come soon.
Live cotton price update: Cotton Rate, Today’s Cotton Price in India: Cotton News on Economic Times (indiatimes.com)
Earlier this year, the prices of cotton went up to Rs. 110,000 per candy (1 candy = 356 kg), while currently the prices are hovering around Rs. 80,000-85,000 per candy. Prices may go down to below Rs. 60,000 per candy by October in case of a bumper crop.
Sowing continues till the second week of August in Maharashtra, Gujarat, Punjab, Karnataka, Haryana, Rajasthan, Madhya Pradesh, Andhra Pradesh, Telangana and Tamil Nadu.
Atul Ganatra, President of the Cotton Association of India, said that at least 10 per cent higher sowing is expected compared to previous kharif season’s 12 million hectare.
Although the acreage of cotton exceeds targets in Maharashtra every year, production is higher due to better yield per hectare.
Avdhesh Sejpal, President, All India Cotton, Cotton Seeds and Cotton Cake Brokers Association, said farmers are shifting to cotton as they are anticipating better return compared to other monsoon crops.
High prices of cotton have impacted inventory levels. The aggregate average inventory holding period fell in FY22 to 98 days from 127 days in FY21, owing to the higher cotton prices-led reduced stock holding. The total cotton stock with mills decreased around 17.8% YoY to 1,326 million kg in FY22, as per the cotton balance sheet provided by Cotton Association of India.
India Ratings and Research (Ind-Ra) said that the cotton prices started moving upwards post-pandemic, not only domestically but also globally on account of the US ban on the use of Xinjiang region cotton followed by a low crop yield in India.
As cotton sowing has already crossed the 10-million-hectare mark in the current kharif season, now experts are expecting further fall of cotton price which will aid the textile industry of India to sustain in the global market.