The Cotton Association of India (CAI) has cut the crop production estimate again by 2 lakh bales of 170 kg each to a 10-year low of 328 lakh bales this season mainly due to rain deficit in key states such as Gujarat, Karnataka, Telangana and Maharashtra.
The trade body has now cut the production estimate by 8.6 per cent from its first estimate of 348 lakh bales during the past six months.
This year, cotton sowing took place in around 123 lakh hectares. But, rainfall was much below normal in September and the entire month of October was dry. Gujarat had rain deficit of 28% while other key production states such as Karnataka, Telangana and Maharashtra also had deficit rains, CAI said.
Around 65 per cent of the Indian crop has arrived so far with 213.42 lakh bales hitting the market by February 28 and another 114.58 lakh bales yet to arrive in markets. The current opening stock is 28.00 lakh bales and arrivals are 213.42 lakh bales up to February 28. The import has been around 5.50 lakh bales up to February 28, which means the available crop is 246.92 lakh bales.
The consumption has been around 131.66 lakh bales from January 10 to February 28 this year. The shipment of exports for the same period has been around 30 lakh bales, the report said.
The closing stock as on September 30, 2019, is expected to be around 17 lakh bales. While the physical stock inside the spinning mill is 43.28 lakh bales, that is, for almost 50 days, and the overall stock with mills and physical stock is 85.26 lakh bales, the association said.
Meanwhile, according to Bangladesh Cotton Association, India’s share in Bangladesh cotton imports in 2019 are likely to fall by 15 per cent from the previous year as lower yarn prices are forcing spinners to cut overseas purchases.
Bangladesh, the world’s biggest fibre importer bought 7.2 million bales of cotton in 2018. Yarn prices have fallen around 10 percent in local market and with reduced margins of spinners, imports have become less lucrative. Bangladesh buys most of cotton from India, the world’s biggest cotton producer.