The Cotton Corporation of India (CCI) has procured 94 lakh bales of cotton, with prices continuing to remain below the Minimum Support Price (MSP) levels due to weak demand. Lalit Kumar Gupta, managing director of CCI, mentioned that procurement is ongoing in all states and field officials will remain present in all market yards until the last arrivals are made. The decision on when to sell the 2024-25 season crop has not been finalized yet.
According to the Cotton Association of India (CAI), market arrivals for the 2024-25 crop season have exceeded 216 lakh bales as of March 1. CAI has revised its crop estimate to 301.75 lakh bales, while the first advance estimates indicate a crop size of 299 lakh bales.
There has been a decrease in market arrivals of raw cotton as farmers are holding back their produce, resulting in prices ranging between ₹6,500 and ₹7,000 per quintal, below the MSP level of ₹7,121 for medium stable cotton. Pradeep Jain, President of the Khandesh Ginners Association, mentioned the challenging market conditions and highlighted the better prices in the cottonseed market compared to raw cotton.
Atul Ganatra, President of CAI, noted that daily arrivals have dropped below 90,000 bales, with CCI purchasing 40,000-50,000 bales. Despite mills needing 1 lakh bales per day, they are only able to procure 40,000-45,000 bales due to weak demand. Pressed cotton prices are currently between ₹53,000-54,500 per candy, depending on quality.
In conclusion, the current cotton scenario presents challenges and opportunities, with Indian mills importing 29 lakh bales to meet demand. The market remains uncertain with stagnant prices, and the expectation is that prices will only stabilize once arrivals slow down. Until then, Indian cotton prices are unlikely to increase without a rise in ICE futures.
