According to PK Agarwal, Chairman and Managing Director, Cotton Corporation of India (CCI), India’s cotton exports may increase by about 30 per cent for the current crop year, October 2020-September 2021, as rising global prices have made the fiber competitive.
Exports could be between 65 and 70 lakh bales (of 170 kg each) compared with 50 lakh bales the previous year. Agarwal sounded bullish on export prospects with CCI holding huge stocks of the fiber.
The bullishness on cotton exports, after traders pruned their projections to 54 lakh bales last month, follows cotton prices in New York topping 89 cents per pound (45,924 a candy of 356 kg).
In contrast, Shankar-6, India’s benchmark cotton for export market, is quoted at Rs44,600 - 45,100 a candy. Cotton futures for delivery in April were quoted at Rs22,200 a bale (₹46,489 a candy) on MCX.
Indian cotton is still the cheapest in the world. There was good demand from countries such as Pakistan, Bangladesh, Vietnam and China among others. Bangladesh is the biggest buyer of Indian cotton. Turkey and Indonesia are other buyers. Pakistan also needs cotton as its crop is lower this year.
However, trade between Pakistan and India came to a halt after the Pulawama blast in February 2019. But Islamabad can still get the commodity from Dubai or other Gulf destinations, indirectly. Indian shippers are offering cotton at least 10 per cent lower than the prices quoted on New York Mercantile Exchange.