The Cotton Association of India (CAI) has lowered its crop forecast for the current season (October 2024-September 2023) to 301.75 lakh bales (of 170 kg ) on a drop in production in Gujarat and Punjab.
CAI in its latest estimate, after discussion with its members across 11 States, said it was reducing its estimate from the previous 304.25 lakh bales.
This is against the Committee on Cotton Production and Consumption, a panel set by the Government, projecting the output at 299 lakh bales.
CAI President Atul Ganatra said the association has cut the production estimated in North India, comprising Punjab, Haryana and Rajasthan, by 2.5 lakh bales to 28 lakh bales. It has reduced Gujarat’s output by 5 lakh bales to 75 lakh bales. At the same time, it has increased Telangana’s crop by 5 lakh bales to 47 lakh bales.
Stocks at hand
This will leave Telangana again as the third-largest producer of cotton with Maharashtra retaining its number one slot producing 90 lakh bales. Gujarat, which produced 100 lakh bales a few years ago, will settle for the second slot for another year.
CAI, in a statement, said that so far 188 bales have been pressed by ginning mills.
Ganatra said during October 2024-January 2025, the average daily pressing of cotton was 1.56 lakh bales. In January, 54.22 lakh bales were pressed at an average of 1.74 lakh bales a day.
He said 85.26 lakh bales of stocks are estimated to be with the trade, ginners and the Cotton Corporation of India (CCI). Ginners across the country are projected to have 10 lakh bales as running stocks.
Offtake to rise
Going by the price trend on Intercontinental Exchange, CCI will likely purchase 95-100 lakh bales of cotton this season under the minimum price support scheme, the CAI president said.
According to the CAI balance sheet, consumption is expected to increase by 2 lakh bales this season mainly from largescale units. Offtake by smaller units and non-textile are projected to remain unchanged.
Ganata said due to reasonable profits in yarn to spinning mills, cotton consumption reached 30 lakh bales in January. In the four months of the current season, they have consumed 114 lakh bales. Spinning mills are estimated to have 27 lakh bales of cotton as inventories.
The association has cut its export estimates to 17 lakh bales against 28.36 lakh bales last season. Ganatra said 8 lakh bales have already been shipped as of January 31 this year.
Imports to go up
The CAI President said cotton imports will rise this season to 26 lakh bales against 15.2 lakh bales last season. Imports are seen increasing on the heels of a drop in production.
In the first four months of the season, 16 lakh bales of cotton have been imported, he said.
In view of the lower crop, the closing or carryover stock is projected to be lower at 25.94 lakh bales.