Since the beginning of this month, cotton prices have increased 39% on the domestic Indian market. However, due to rain in many regions of the nation, cotton arrivals have decreased to a 20-year low.But as arrivals pick up steam in the current season (October 2022–September 2023), trade and industry officials say prices are predicted to moderate and then begin to decline. Cotton arrivals in October 2010 were 61,572 tonnes, down from 1.12 lakh tonnes the previous year, according to the Agmarknet portal, a division of the Ministry of Agriculture. The influx of arrivals is at its lowest level since the period of 53,221 tonnes in 2003.
“Due to rains, arrivals are currently between 30,000 and 35,000 bales (170 kg), down from the usual 50,000 bales. Arrivals will rise and prices will drop if the weather improves, according to dealer Anand Popat of Rajkot, Gujarat.
Prices for the Shankar-6 variety, the benchmark for exports, are currently trading at 71,500 per sweet (356 kg), compared to 69,000 on September 30. At the Rajkot agricultural produce marketing committee (APMC) yard in Gujarat, the price of raw cotton climbed from $8,250 per quintal to $8,800 during that time.
“Prices are dropping down today (compared to 1 lakh candy in May), and we expect it to be in the 60,000 range per candy after arrival speak in India,” said Prabhu Dhamodharan, Convenor, Indian Texpreneurs Federation (ITF). “Cotton is in demand at the moment as mills attempt to increase inventories following a lengthy closure. How long can they leave their units unopened? In due order, arrivals will rise, according to Popat. If the weather stays favourable, the dealer from Rajkot predicted that cotton production will reach at least 375 lakh bales this year. There haven’t been any significant complaints of agricultural damage,” he said.
According to K Venkatachalam, Chief Advisor of the Tamilnadu Spinning Mills Association (v), cotton off-take is down, and many mills in Andhra Pradesh are closing as of right now. “Post-Diwali, spinning factories in Tamil Nadu may close due to a lack of yarn demand. How long can they keep going without customers?” he questioned. Even if inventory adjustments were being made, according to Dhamodharan, retail demand in the U.S. has not decreased significantly.
