Global prices of the cotton commodity shot up after India, the second largest exporter of cotton, imposed ban on the commodity.
According to the officials, India imposed ban to ensure sufficient amount for the domestic industries as the exports surged to about 9.5 million bales (170 kilograms each) more than the surplus of 8.4 million bales estimated by the government.
While the government has issued registration certificates for another 2 million bales.
According to United States Department of Agriculture (USDA), India accounts for 17% of global exports in 2011-2012. China is the largest consumer of Indian cotton.
India is expected to produce around 34 million bales of cotton for 2011-12. and is expected to export around 70 million bales.
In Inter-Continental Exchange (ICE), cotton for march delivery gained 0.22 cents to 89.78cents per lb.
While, in India's National Commodity and Derivative Exchange (NCDEX), cotton for March delivery traded up 0.06% to Rs 810 per kg on 9th March at 16:20 IST.
According to the officials, India imposed ban to ensure sufficient amount for the domestic industries as the exports surged to about 9.5 million bales (170 kilograms each) more than the surplus of 8.4 million bales estimated by the government.
While the government has issued registration certificates for another 2 million bales.
According to United States Department of Agriculture (USDA), India accounts for 17% of global exports in 2011-2012. China is the largest consumer of Indian cotton.
India is expected to produce around 34 million bales of cotton for 2011-12. and is expected to export around 70 million bales.
In Inter-Continental Exchange (ICE), cotton for march delivery gained 0.22 cents to 89.78cents per lb.
While, in India's National Commodity and Derivative Exchange (NCDEX), cotton for March delivery traded up 0.06% to Rs 810 per kg on 9th March at 16:20 IST.
CAB, in its meeting next week, may revise cotton output estimates downwards for the current year. In the last meeting, it had estimated the cotton crop at 35.6 million bales (one bale of 170 kg). It may now cut this by a million bales, said a source.
CAB is headed by the Union textile commissioner and comprises trade and industry representatives.
A couple of weeks before, the International Cotton Advisory Committee had cut global production estimates by nearly seven per cent to 24.9 million tonnes (mt) for the 12 months ending July from 26.8 mt a year earlier. Following this, the US agriculture department had also cut world cotton output estimates and said India would also produce less this season. It had said India’s output will be lower to 34.25 million bales from the earlier estimate of 35 million bales.
Low arrivals at this time are seen as a concern and indicate the late crop may have been affected in some parts and overall output may be lower. So far, only 60 per cent of the total cotton has come into the market. Traders say arrivals on a daily basis are around 200,000 bales, which should have been higher in early January.
The benchmark variety, Shankar-6 prices have risen from Rs 34,000 a candy (1 candy = 356 kg) to Rs 37,800 a candy, up 11 per cent in the last two weeks.
Cotton Corporation of India started buying the crop last week, but not in a big way, said an official.
“Currently, high export demand from China is supporting prices,” said Rahul Kotecha, a Coimbatore-based trader. Export demand has picked up from major textile hubs like China, Bangladesh, Taiwan and Indonesia. China’s December cotton imports rose 71 per cent year-on-year to 790,000 tonnes and the country will soon issue another import quota of 1.1 mt.
Demand from cotton yarn manufacturers also increased in the last couple of weeks.
Sources said so far 4.6 million bales had been exported and by March-end 5.5-6 million bales were expected to be exported. “I feel more than five million bales of cotton has been registered for exports so far,” said a source with a government body.
CAB is headed by the Union textile commissioner and comprises trade and industry representatives.
A couple of weeks before, the International Cotton Advisory Committee had cut global production estimates by nearly seven per cent to 24.9 million tonnes (mt) for the 12 months ending July from 26.8 mt a year earlier. Following this, the US agriculture department had also cut world cotton output estimates and said India would also produce less this season. It had said India’s output will be lower to 34.25 million bales from the earlier estimate of 35 million bales.
Low arrivals at this time are seen as a concern and indicate the late crop may have been affected in some parts and overall output may be lower. So far, only 60 per cent of the total cotton has come into the market. Traders say arrivals on a daily basis are around 200,000 bales, which should have been higher in early January.
The benchmark variety, Shankar-6 prices have risen from Rs 34,000 a candy (1 candy = 356 kg) to Rs 37,800 a candy, up 11 per cent in the last two weeks.
Cotton Corporation of India started buying the crop last week, but not in a big way, said an official.
“Currently, high export demand from China is supporting prices,” said Rahul Kotecha, a Coimbatore-based trader. Export demand has picked up from major textile hubs like China, Bangladesh, Taiwan and Indonesia. China’s December cotton imports rose 71 per cent year-on-year to 790,000 tonnes and the country will soon issue another import quota of 1.1 mt.
Demand from cotton yarn manufacturers also increased in the last couple of weeks.
Sources said so far 4.6 million bales had been exported and by March-end 5.5-6 million bales were expected to be exported. “I feel more than five million bales of cotton has been registered for exports so far,” said a source with a government body.
