Intervening to resolve issues regarding cotton yarn prices between cotton yarn manufacturers and downstream textile industry, Union Textile Minister Piyush Goyal has instructed the textile industry to resolve cotton pricing issue in the spirit of collaboration rather than competition and not to push Government to intervene.
He also cautioned traders from manipulating prices or hoarding to make unfair profit.
“Pricing issue of cotton bales and yarn for the industry should not be allowed in any way to impact the better prices which farmers are getting,” he said.
The Minister today had a meeting with various trade bodies of the textile Industry. Minister of State for Textiles Darshna Jardosh, UP Singh, Secretary, Textiles, Pradeep Agarwal, CMD, CCI and senior officials of CCI, textiles industry players and exporters participated in the meeting.
“We expect that as of now the Government has no plans to make any kind of restrictions. As such, the status quo will be maintained for both exports and imports also. But if prices go out of control, the MoT will be forced to take action.”
The Minister said that farmers’ interests are being taken care off for the first time as they are now getting better cotton prices – supported by very good base MSP. Pricing issue of cotton bales and yarn for the industry should not be allowed in any way to impact the better prices which farmers are getting, he added.
“The idea of short-term supernormal profits by a section of players in the textile value chain is not sustainable. No one should force the Government to intervene. Let free and fair market forces play out. Supernormal profits should not be booked for short-term goals”, he said.
It may be noted that cotton production is estimated at 362.18 lakh bales. Notably, the cotton season (2021-22) commenced with an estimated carry overstock of 73.20 lakh bales (COCPC meeting dated 12.11.2021).
Opening stock in the country is adequate to meet about two and half month’s mills consumption. Cotton prices are ruling above MSP level by about 40 per cent, i.e., Rs. 8,500 per quintal as against MSP rate of Rs. 6,025 per quintal. Farmers are getting reasonably good prices for their produce which is in tandem with other agri-commodities as well.
World cotton acreage is expected to increase by 4 per cent to 33.27 million hectare as against 31.97 million hectare of last year. Whereas world cotton production is projected to increase by 6 per cent to 1,512 lakh bales (25.72 MMT) as against 1,426 Lakh bales (24.26 MMT) of last year and world cotton consumption is expected to increase by 2 per cent to 1,530 lakh bales (26.01 MMT) as against 1,505 lakh bales (25.60 MMT) of last year.
