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CAI Drops Cotton Production Estimate To 330 Lk Bales

26 May 2020 3:38 pm
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Mumbai (commodities control) - Cotton Association of India(CAI) has cut the cotton production estimate to 330 lk bales from earlier estimate of 354.50 lk bales, down 24.5 lakh bales or 7%.

Atul Ganatra of CAI attributes it to the fact that many farmers did not wait for the last picking of cotton and uprooted plants for other rabi crops. This was witnessed especially in Gujarat, Maharashtra and Karnataka, where cotton output estimate has seen deep downward revision. Gujarat's cotton production is estimated to fall by 11 lakh bales, while Maharashtra's output is likely to drop 8 lk bales. Karnataka's cotton output is seen dropping by 2 lk bales. Meanwhile CAI has raised its cotton exports forecast by 5 lakh bales from 42 lakh bales to 47 lakh bales as Indian rupee has depreciated by 8-10%. Currently Indian cotton is the cheapest in global market and has better competitive edge. Indian cotton was sold at around 62 cents per pound on a cost and freight basis (C&F) to Asian buyers such as Bangladesh, while the supplies from the United States were available at around 70 cents. This has posed tough competition for Australia, Brazil and U.S. China, Vietnam and Bangladesh are the top buyers of Indian cotton at the moment. Although on domestic front, supply will continue to exceed demand. According to CAI, cotton demand is seen dropping 15%, with a dip of 20 lk bales in April and 13 Lakh bales in May. For the year, the demand may fall by 51 lk bales.

       
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