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Cotton Prices Firm In Central, South India

10 Jan 2020 1:53 pm
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MUMBAI (Commoditiescontrol) - Cotton prices ruled firm at major markets in Central and South India on Friday due to strong demand from mills and exporters amid an uptrend in the global market.

Cotton exports from India have gained momentum due to a depreciation in the rupee and as prices have rallied in overseas markets, prompting Asian buyers such as China, Bangladesh and Vietnam to raise Indian purchases, dealers said.

Right now, Indian cotton is 3 to 4 cents cheaper than the supplies from Brazil and the United States.

India has shipped 1 million cotton bales since the 2019/20 marketing year started on Oct 1 and another 700,000 bales have been contracted for shipment in January and February.

"Cotton export shipments from 1st October 2019 to 31st December 2019 which have already been shipped are estimated at 10 lakh bales while balance 32 lakh bales are expected to be shipped during the period from 1st January 2020 to 30th September 2020. Total exports estimated during the entire season are 42 lakh bales," said CAI.

Until few weeks ago, Indian traders had been struggling to sign export contracts as local prices exceeded global prices after New Delhi raised the minimum buying price to support farmers.

Arrivals today stood at 57,000 bales in Gujarat, 60,000 bales in Maharashtra, 14,000 bales in Madhya Pradesh, 49,000 bales in Andhra Pradesh & Telangana and 12,000 bales in Karnataka.

Meanwhile, state-run Cotton Corporation of India (CCI) has procured around 35.18 lakh bales (of 170 kg each) of cotton till January 8 in the current season, i.e. 2019-20 at the minimum support price (MSP) from key growing states.

A total of 4,25,000 bales of cotton have been purchased from North India, 20,00,000 bales from Telangana, 5,50,000 bales from Maharashtra, 2,20,000 bales from Gujarat, 96,000 bales from Madhya Pradesh and 92,000 bales from Andhra Pradesh.

Globally, ICE cotton futures rose more than 1 percent to an eight-month high on Thursday, as investors remained bullish ahead of the US Department of Agriculture's monthly crop supply and demand report.

The benchmark cotton March contract rose 73 points to close at 70.69 cents per lb . It rose to 70.85 cents earlier in the session, the level last seen on May 10.

Technically, cotton is looking firm with support for ICE cotton March contract is at 69.08 cents, while resistance at 71.66 cents. While, cotton Jan contract on MCX has crossed the target of Rs 19,900, suggested by commoditiescontrol.com. It is currently trading at Rs 19,980/bale. The price will continue to rise further and may soon go up to Rs 20,200.


       
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