By: Seshadri Ramkumar, Professor, Texas Tech University, USA 

(Coimbatore, India, June 26, 2022)- Cotton price will soften in the new season beginning October 1, 2022.

Yesterday (June 25, 2022) in an event organized by Textile Association India, South India Unit in Jenny’s Residency, Coimbatore about 700 technical experts in the textile industry from all parts of India gathered to analyze the cotton situation.

I had the privilege to address the standing room only audience of technical people for 90 minutes on cotton situation providing detailed analysis.

The analysis centered on the drivers of the sector: 1) demand and supply; 2) climate; 3) economy and inflation; 4) geopolitical scenario; 5) market influences.

By interacting with international stakeholders in the cotton sector in the United States and India and based on the planted acres, economic situation, inflation, etc., my prediction is that there will be tight supply situation, but the price will moderate in the new season.

Cotton is expected to range between Rupees 60,000 to mid-50,000 range per candy (356 Kgs). As the season progresses, based on satisfactory climate with no delayed rains in Gujarat and weather situation in Texas, the price may further soften to lower Rupees 50,000 level. As the cotton pipeline is basically empty now, price may begin at slightly elevated level in the new season and as the arrival picks up, with steady pipeline, price will soften and hence the above range is expected.

This situation may be comfortable to farmers, textile sector and consumers.

We must be cognizant that consumer will be the key player. Interest rates, income levels all influenced by inflation will drive the demand for nonessential commodities.

Cotton is here to stay and its inherent attribute, “comfort,” is a much-preferred attribute.