This has come even after two rounds of price increases by mills that resulted in yarn prices going up about Rs 20 per kg since April. He said this would greatly benefit the farmers and the industry and curb speculations.
Advertisement
Talking to KNN, President of The Textile Association (India), Arvind Sinha, said that farmers can not be blamed because yield has also gone up.
The Cotton Advisory Board, which met in Mumbai on Wednesday, has brought down its estimates for domestic cotton production for the current season.
Cotton production is estimated to be 338 lakh bales in the 2015-16 season (which began on October 1) from 386 lakh bales in the previous year as the area under cotton has decreased to 119.10 lakh hectares this season compared to 128.46 in the previous year. Interestingly, mills in the state have started importing cotton as prices are ruling lower in the worldwide market.
He said the abnormal increase in cotton price would have a serious impact on the entire textile value chain as the worldwide cotton price is ruling over 10 per cent lower and the Indian cotton textiles and clothing industry can not compete in the global market and the exports would drop further.
Stockpiles were depleted after drought and pest attacks reduced yields, while exports rose 17.8 per cent to 6.8 million bales, she said. The body has estimated the closing stock at 43 lakh bales as against its previous estimate of 35 lakh bales for the season.
Production in the central zone including Gujarat, Maharashtra and Madhya Pradesh is expected to fall 11 per cent to 187 lb from 211 lb registered past year while it has dipped 30 per cent to 37 lb in the northern zone (Punjab, Haryana and Rajasthan).
Commissioner also said exports are likely to grow as China, which is low on stocks, will improve its inventory. Since then cotton which was hitherto imported during independence, became the mainstay for farmers, and India achieved self-sufficiency to becoming a raw cotton exporter.
Advertisement
Stating that traders have been speculating on prices predicting acreage for the coming season would drop, CAB on the contrary, has estimated a reasonable acreage suggesting cotton supply position to be comfortable in the coming season also.
