The State-run Cotton Corporation of India (CCI) has started the sale of cotton procured in the current marketing season 2024-25 from Wednesday. However, the response to the first day sale was muted as millers and trade were selective in buying quality cotton as CCI base price is higher than the prevailing market price.
The CCI base price was ₹54,000-₹55,500 per candy (of 356 kg), while the market prices are hovering in the range of ₹52,500-₹54,000. CCI, which offered around 6,02,300 bales (of 170 kg) of both new and old cotton on Wednesday, could sell only 6,800 bales to mills, while traders bought only 300 bales, sources said.
CCI has purchased over 94 lakh bales of raw cotton at minimum support price of ₹7,521 per quintal, while the market prices still continue to rule below the MSP levels on muted demand. CCI has procured over 40 lakh bales in Telangana, over 28 lakh bales in Maharashtra and over 11 lakh bales in Gujarat.
Selective buying
CCI is presently the largest stockholder of the fibre with cumulative market arrivals till date having crossed 219 lakh bales for the 2024-25 marketing season, per the Cotton Association of India data. CAI has estimated the 2024-25 crop size at 301.75 lakh bales.
At current market rates, CCI may find it difficult to offload the stocks as the buyers are selective. “There will be possibility for selling small quantity only for the quality cotton only on longer credit terms,” said Ramanuj Das Boob, a sourcing agent in Raichur. Further, the global prices are under pressure with US imposing tariff on exports to China, which will weigh on the prices, Das Boob said.
The New York ICE Cotton Futures, which ruled at around 66 cents per pound for May delivery before the imposition of tariff, have come to the level of 63 cents per pound.