December 29, 2011

Cotton arrival in Indian states gains momentum

The arrival of cotton in terminals and markets in India's Punjab and Haryana has picked up by almost 40% in the last few days.

As against the average arrival of 25,000-26,000 bales coming across various markets in Haryana, Punjab and Rajasthan, the arrival now has moved to 35,000 bales. The prices, however, have not moved up in proportion to the arrival of cotton.

The arrival has moved up primarily as off take by mills has improved. With mills exhausting their available stock, they have entered market for fresh purchases. In addition to this, members of ginning association adds the domestic demand has started picking up as yarn realisation are moving to better from stable. These all factors are contributing towards rise in off take of cotton from the terminal markets. Members also believe this farmers have started realising remunerations for cotton this year would not be as high as last year, have started bringing the crop to the markets.

Bhagwan Das Bansal, president Punjab Cotton Factories and Ginners association maintained stronger dollar also suggest things on export side could improve for cotton this year, thus helping the cause for cotton. "We are expecting exports of nearly one crore cotton bales this year as well, which is similar to previous year," Bansal added.

Rathi added on export front they were eyeing China which happens to be major market for Indian cotton. Besides exporting the allotted quota of cotton bales to China, they were also eyeing the quota of cotton under sliding duty system.