Cotton transactions dipped on Wednesday even as the market is expecting a review of the ban on cotton exports, according to trade sources here.
K. N. Viswanathan, Vice-President, Indian Cotton Federation, told this correspondent that transactions were low in almost all the cotton markets in the country and prices remained at Tuesday's level. In the international market, though the prices went up on Tuesday following India's ban of cotton exports, it came down on Wednesday.
Trade sources here said transactions were expected to be low on Thursday too, because of Holi festival. Further, there was a possibility in the relaxation of the export ban in a couple of days. Though prices were maintained at Tuesday's level, when the cotton markets opened on Wednesday, transactions were lower and selling was tight.
In Gujarat, nearly 975 ginning units went on a two-day strike on Wednesday protesting against the export ban. “The units have shut down totally. We are expecting a positive announcement in two days,” said Bharat Vala, President of Saurashtra Ginners' Association.
Chairman of Confederation of Indian Textile Industry S. V. Arumugam, however, said in a release that the association welcomed the move to ban cotton exports. If the decision had not been taken at this stage, exports would have reduced the cotton stocks to a dangerous level.
The ban was needed to ensure fibre security to the textile industry.
The raw material base of cotton was the core strength of the Indian textile industry and stock of minimum two-and-a-half month consumption should be provided at the beginning of the next cotton season. If exports had crossed 94 lakh bales, the carry-over stock for the next season would have fallen below the desired level, he said.
