Gains for cotton result from CAI lowering its estimate to 29.4 million bales

Prices for cotton, which are shown above as “Cotton candy,” increased somewhat by 0.11% to settle at 55940. For the current 2023–2024 season, the Cotton Association of India (CAI) updated their cotton production projection to 29.4 million bales. This negative revision was ascribed to farmers uprooting plants and pink bollworm infestation damage in Haryana.

In addition, insufficient rainfall is predicted to cause a notable 25% decrease in cotton production in north Maharashtra. Global ending stocks increased as a result of the U.S. Department of Agriculture’s (USDA) November World Agricultural Supply and Demand Estimates report, which raised the projected U.S. production in 2023–2024.

Pink bollworm infestation in the cotton crop is said to be declining, falling from 30.62% in 2017–18 to 10.80% in 2022–2023. Deliverable against the contract, certified cotton stockpiles saw a significant decline, peaking at 87,770 bales on December 1st, more than two years ago, and ending at 6,325 bales on December 5th.

For the second year in a row, worldwide cotton production is expected to surpass consumption, according to projections made by the International Cotton Advisory Committee (ICAC). Cotton futures experienced a decline due to weak demand, which was seen in the 5-week low of worldwide cotton bookings recorded during the final week of November. As can be seen by the 4.62% decline in open interest to 186, the market is technically under short.

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