India’s cotton industry is bracing for a significant increase in imports during the 2024-25 crop year. The surge is primarily attributed to a combination of lower carry-forward stocks and a projected decline in domestic production due to reduced acreage.
According to the Cotton Association of India (CAI), imports are expected to reach approximately 35 lakh bales this year. This figure is significantly higher than the 16.40 lakh bales imported during the same period last year. The increase is primarily driven by the anticipated shortfall in domestic production, as sowing has decreased by 12-13 lakh hectares.
The CAI’s Atul Ganatra noted that the lower production is also due to the absence of carry-forward stocks from the previous season. While farmers have retained 30 lakh bales of unprocessed cotton (kapas), this is insufficient to meet domestic demand.
The U.S. Department of Agriculture (USDA) has estimated India’s 2024-25 cotton output at 24 million bales, down 7% from last year’s 25.80 million bales. This decline is primarily attributed to lower harvest areas.
To address the anticipated shortfall, Indian traders have already contracted shipments of 7-10 lakh bales for the November-March shipment period. The landed cost of imported cotton, including customs duty, ranges from ₹63,480 to ₹69,120 per bale, depending on the origin and grade.
The recent decline in spot cotton prices in India has also encouraged imports. Traders are taking advantage of lower global prices to secure supplies for the domestic market.
While the overall outlook for India’s cotton industry remains challenging, experts are cautiously optimistic about the potential for a recovery in domestic production in the coming years. However, the industry will need to closely monitor global market trends and take proactive steps to ensure a stable supply of cotton to meet domestic demand.
