MUMBAI (Commoditiescontrol) - The U.S. Department of Agriculture’s (USDA) has earlier estimated India’s cotton exports in 2014-15 at 4.2 million bales (480lb each), from which around 3.6 million bales have been exported during August 2014-April 2015 in the current season.
According to a USDA attache report, the country’s cotton exports would be moving on a sluggish note during rest of the season, considering the pace of exports and a probable rise in release of auction volume by the Cotton Corporation of India (CCI). The average export shipments are likely to hover near 200,000 bales per month through July.
In the wake of Indian Rupee becoming stronger by around 3 percent against the U.S. dollar, volume in exports has slowed down since March. Bangladesh has emerged as the major export destination for Indian cotton along with Vietnam, China and Pakistan.
However, import estimate for the year remains unchanged from the departments previous estimate of 1.1 million bales. Demand for imported cotton has picked up as Indian arrivals have slowed down at market yards at present as farmers are not willing to bring their produce at the current rates in anticipation of higher price realization. Imports of higher quality upland and ELS from the U.S. remain dominant (30 percent of total shipments received in April). Competitively priced new crop cotton from West Africa (Mali, Cote d Ivoire, and Burkina Faso) is being imported to cover mill demand, as well. Consequently domestic buying from mills has been limited in the last month as international cotton provides a cheaper option.
All India cotton arrivals as on 28 April, 2015 reached at 26.54 million bales compared to 26.08 million last year. This is around 88 percent of USDA’s previous estimated production.
The report states that the recent unseasonal rains have delayed summer crop harvesting and northern India kharif cotton planting for 2015-16. Rains in late February and March delayed harvesting of wheat in the northern cotton regions of Punjab and Haryana and affected the planting of crop by 15-20 days. Cotton planting in north regions typically begins in April-May.
On the other hand, overall cotton procurement under minimum support price (MSP) operations has reached 6.79 million bales, from both the CCI and Maharashtra by the state marketing federation (MAHACOT). The government of India had approved allocation of extra funds towards procurement of cotton at MSP. To do so, the government has directed MAHACOT to undertake MSP operations, as a sub-agent to the CCI. Accordingly, around 10 million bales cotton will be procured by the CCI and MAHACOT will procure around 1 million bales through the end of the current season.
The average per month mill consumption rate in 2014-15 is 1.96 million bales. The post estimate for 2014-15 remains unchanged from the USDA’s official estimate at 2.4 million bales.
The USDA lowers India’s 2014-15 cotton ending stocks at around 1.3 million bales compared to around 1.4 million bales estimated earlier.
(By Commoditiescontrol Bureau; +91-22-61391533).
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