India’s cotton market is experiencing a standoff between ginners and buyers. With daily arrivals dropping and prices hovering around ₹57,000 per candy, neither side is willing to budge.
Ginners Hold Firm
Ginners, who process raw cotton into bales, are reluctant to sell at current prices, fearing further decline. Pradeep Jain, President of a ginning association, believes prices shouldn’t fall below current levels.
Futures Market Shows Mixed Signals
The July cotton contract on the international ICE exchange has seen a slight increase, prompting multinational companies in India to raise their selling prices. However, the domestic MCX exchange shows some upward trend as well.
Cotton Corporation of India (CCI) Sells Stock
Interestingly, the CCI, a government agency, managed to sell some cotton to mills despite lowering their price.
Market Outlook Uncertain
Experts predict prices are unlikely to fall further due to low arrivals, but yarn demand remains weak, causing mills to purchase cautiously. Anand Popat, a market agent, believes prices might even rise due to a tight cotton supply in India.
Volatility Attributed to Speculation
Some experts attribute the recent price fluctuations to speculation in the global market rather than any fundamental shifts in supply or demand.
Overall, the cotton market faces a wait-and-see approach from both ginners and buyers. While low arrivals suggest prices could rise, weak yarn demand creates a countervailing force.
