‘Indian cotton exports to decline in 2014-15’

Sai Nikesh | The Dollar Business

Reproving the reports that ‘Indian cotton prices have gone up on hopes of fresh export demand’, Indian Cotton Federation (ICF) opined that cotton situation in 2014-15 season that started in October 2014, in all terms, is most likely to remain the same to what it was in 2013-14 season. Speaking to The Dollar Business, K N Viswanathan, Vice-President, ICF, said, “Going by sowing figures and cropping situation till date, Indian cotton prices in 2014-15 season that is going to last till September 2015, is likely to remain around 35,000-35,500 per candy of 355 kg under Shankar-6 variety benchmark, almost similar to what it was in 2013-14.” On reports over occurrence of fresh export demand for Indian cotton, he said, “Export demand is very less significant and remains sluggish.” And, with China, the top destination for Indian cotton, remaining inactive in importing the commodity, exports are not expected to see a significant growth in the current year, he added. While 90 lakh bales of cotton was exported from India in 2013-14, exports in the current year are likely to end up at around 45 lakh bales with 35-37 lakh bales already exported as of June 30 2015, he noted. According to Cotton Advisory Board, country’s total production during 2013-14 stood at 390.00 lakh bales and the ICF official said that the estimated production for 2014-15 stands at around 387 lakh bales. In an earlier conversation with The Dollar Business, he had also said that the supply-wise trend for cotton market continues to be good, consumption is manageable and prices are also under control as a result of government’s moves like increasing of Minimum Support Price (MSP). However, he raised challenges in case of movement of goods. He had also said that concerns over monsoon, which are making rounds all over are not going to affect cotton production in 2015-16 season and exuded confidence that ‘cotton production in the country is expected to be good this year and will also be positive in the coming year’. But, the recently released International Cotton Advisory Committee (ICAC)’s report said that world’s cotton area in 2015-16 is expected to decline by 6% to 31.3 million hectares due largely to lower prices in 2014-15. Low cotton prices during 2014-15 in India are expected to cause cotton area to decrease by 5% to 11.6 million hectares in 2015-16, it noted, adding that, falling prices for competing crops and a modest increase in the MSP may forestall a greater decline. The Indian monsoon arrived earlier this year compared to 2014-15 and yields may improve 3%, limiting the decrease in production to 6.4 million tons, said the ICAC report released on July 1, 2015.    

July 4, 2015 | 5:40 pm IST.