With the beginning of the cotton season (October 2009 – September 2010), the textile industry desires that the domestic cotton prices will remain lower than the international prices, giving the industry a competitive edge in the export market.
The country expects a huge production of cotton this year (305 lakh bales) and the carry over stock was also high at 71 lakh bales. The Central Government increased the Minimum Support Price (MSP) for cotton by almost 40 per cent last year. It has maintained the MSP at the same level this year. Last year, the Cotton Corporation of India and the National Agricultural Cooperative Marketing Federation of India purchased about 127 lakh bales. Trade and industry sources here said that the CCI was expected to be a major player in the market this year too.
The textile mills were expected to start buying cotton from the third week of this month. The domestic prices should be lower than the international prices and should remain stable throughout the year.
And, cotton should be available in the market during the peak purchasing period of October to January, according to J. Thulasidharan, Chairman of the Southern India Mills’ Association. The industry had represented its problems to the Union Textile Minister and he had assured the industry that it would not face the problems again and would have the advantage of home-grown cotton.
“Hence, we are confident on the cotton front,” he said.
According to K.N. Viswanathan, Secretary of the South India Cotton Association, cotton arrivals from Gujarat, Punjab, Haryana, Rajasthan and Karnataka had started with about 20,000 bales coming to the market every day.
Currently, the domestic cotton prices were slightly lower than the international prices and export enquiries were said to be good.
