According to report published by Geojit Financial Services, arrivals of cotton in spot markets across India declined to 147,500 bales (1 bale = 170 kg) on Tuesday from 149,000 bales on Monday.
In Gujarat, the Shankar-6 variety was sold at 37,500-38,500 rupees per candy (1 candy = 355.62 kg). In Maharashtra, the 29-30 mm variety was 38,000-39,000 rupees per candy. Gujarat is the largest producer of cotton, followed by Maharashtra.
The Cotton Association of India has maintained its estimate for production in the country in the 2019-20 (Oct-Sep) season at 35.45 million bales, up 13.6% from the last season. Considering the opening stock of 3.2 million bales, the cotton body expects the total supply to be around 41.15 million bales in the current season. The cotton body retained its estimate of 4.2 million bales for exports and pegged imports at 2.5 million bales.
Domestic consumption is expected to be 33.1 million bales, unchanged from the previous month’s estimate. Closing stock of cotton for the 2019-20 season is now pegged at 3.85 million bales.
Currently, domestic cotton prices are lower than international due to high domestic crop in the current season and concerns over demand. The US Department of Agriculture (USDA) has scaled up its estimate for the closing stock of cotton globally in 2019-20 (Aug-Jul) to 83.40 million bales (1 US bale = 218 kg), against the 82.12 million bales it had projected in February. It pegged global production higher at 121.59 million bales from the 121.33 million bales it had estimated in February.
USDA’s Foreign Agricultural Service has maintained its estimate for India’s 2019-20 (Aug-Jul) cotton production at 37.6 million bales (1 bale = 170 kg). It has revised upward its import estimate to 2.8 million bales from 2.6 million bales in January. It has increased the import estimate on expectation of a rise in shipments from the US and Brazil. Opening stock of cotton in India is estimated at 11.7 million bales, while consumption by mills is seen steady at 31.5 million.