As cotton futures on the Intercontinental Exchange (ICE) decline, domestic resellers and multinational corporations have begun to sell stocks of the fiber crop at rates below those established by the Cotton Corporation of India (CCI). This occurs in the context of weak demand.
Since early February, ICE cotton futures rose approximately 47%, climbing from around 60.52 cents per pound on February 9 to a peak of 88 cents on May 11. However, prices have retreated to around 76-77 cents due to various factors, including improved weather conditions in the United States and Brazil, decreased crude oil prices, a strengthened US dollar index, and uncertainties concerning global demand recovery.
In the Indian physical market, cotton prices also adjusted following declines in futures, though the reduction was limited compared to international trends. This is attributed to lower arrivals, tightening spot availability, and elevated domestic basis levels. Anand Popat of CotYarn Trade Link noted in his weekly newsletter that the Indian basis—the difference between spot prices and futures—strengthened to 8.55 cents per pound against ICE July futures, indicating that Indian cotton continues to trade at a premium compared to global futures.
Popat mentioned, “CCI still holds sizeable unsold stocks, which may continue to influence domestic market sentiment in the coming weeks. Overall, the market remains technically weak in the short term, but strong Indian basis levels and tightening domestic supply may continue to support Indian cotton prices relative to global markets.”
CCI, which began selling cotton from the 2025-26 season at a minimum support price of approximately ₹57,200 per candy (356 kg), initially reduced prices to around ₹54,600 but gradually increased them to ₹68,600 in alignment with global price trends. The organization ceased sales from May 22 due to technical issues.
During the 2025-26 season, CCI procured about 105 lakh bales (170 kg each) and has sold approximately 72 lakh bales thus far, leaving an estimated 33 lakh bales in stock according to trade sources.
In the yarn market, there has been significant price volatility. Resellers and multinationals are reportedly selling at prices lower by ₹2,000 per candy than the CCI’s listed price, as there are currently no buyers for cotton or yarn, according to Ramanuj Das Boob, a sourcing agent in Raichur. The yarn market is similarly sluggish, with prices having declined by ₹30-35 per kg following rises in crude oil prices.
The Cotton Association of India (CAI) stated on Tuesday that it anticipates a 7% increase in cotton acreage in the upcoming kharif cropping season, driven by encouraging price signals for farmers. Cotton was planted on 114.82 lakh hectares during the 2025-26 season. For the 2026-27 marketing season, the government has increased the minimum support price by ₹557 per quintal to ₹8,267 for medium staple cotton and ₹8,667 for long staple cotton.
Published on May 27, 2026.
