The Cotton Corporation of India (CCI) has started procuring cotton at the Minimum Support Price (MSP) in Andhra Pradesh and Telengana as the market price for cotton in these States is less than the MSP.
An official of the CCI told The Hindu that it had procured 15,000 bales in the last one week. The market rate for long staple cotton in these markets was quoted at Rs.3,800-3,900 a quintal as against the MSP of Rs.4,050 a quintal.
The market price for cotton ranged between Rs.32,000 and Rs.34,000 a candy, while the MSP was at least Rs.37,500, the official said.
Nearly 40,000 bales of cotton are coming into the market every day, and it will go up to over one lakh bales in December and January. The Cotton Advisory Board has estimated domestic cotton production at 400 lakh bales this year (October, 2014 to September, 2015).
Though the market prices might not fall further, the CCI might have to buy one crore bales of cotton this year at the MSP, the official said. In 2008-09, it had procured about 90 lakh bales. Last year, it purchased just 40,000 bales at the MSP.
The CCI had equipped its 330 centres for MSP operations, and these were spread across the cotton growing centres in the country. With CCI commencing purchases in the market, the prices had stabilised to some extent, the official added.
