CAI trims crop estimate to 315 lakh bales, much lower than 365 lakh bales last year.
Amid a severe shortage of the fibre crop, India’s cotton imports are set to more than double to 31 lakh bales (each of 170 kg) this year as compared to 15 lakh bales reported last year. The imports this year will set a new milestone after 2016 when the country imported a record 29 lakh bales of cotton. On Tuesday, the Cotton Association of India (CAI) made this import projection after it trimmed crop estimate to 315 lakh bales, about 6 lakh bales lesser than its previous estimate. Last year, cotton crop stood at 365 lakh bales. The drop is attributed to acute water shortage in the growing regions of Gujarat, Maharashtra, Telangana and Karnataka and uprooting of cotton plants by farmers in about 70-80 per cent of area without waiting for 3rd and 4th rounds of picking. CAI President AtulGanatra said, “International cotton prices are low but the quality is not up to the mark and it is mostly coloured cotton. Most of the good quality cotton from Australia and other nations has been bought by large buyers like China. We see most of this imports to take from the US and Western African region.” So far import contracts for 20 lakh bales have been made, of which shipments of 7 lakh bales are reported to have already arrived in the country till April-end, while the shipments for other 13 lakh bales will arrive during May, June and July.
CAI has projected cotton exports at 46 lakh bales, a tad lower than earlier estimate of 47 lakh bales, mainly “on account of prevailing higher prices of Indian cotton and smaller crop size. Last year, cotton exports from India were 69 lakh bales. Thus, the cotton exports this year are estimated lower by about 33 per cent,” Ganatra said. Raw cotton prices ruled around Rs. 6,125 a quintal in the spot market in Gujarat markets, while on BSE futures May cotton contract traded at Rs. 22,230 a bale on Tuesday, Rs. 160 higher than the previous close figure. Indian cotton arrivals during October, 2018-April 2019 are estimated at 278.73 lakh bales. Consumption by Indian spinning mills for seven months between October 1, 2018 to April 30, 2019 is estimated at 183.75 lakh bales. Stocks held by Cotton Corporation of India (CCI), MNC buyers, ginners and exchange are estimated at 47.75 lakh bales as on April 30, 2019 which is about 51 lakh running bales. “Due to small crop size and a very tight cotton balance sheet, closing stock as on September 30, 2019 is estimated by the CCI’s Cotton Crop Committee at 13 lakh bales of 170 kgs. Each,” CAI said.