Rising domestic demand amid limited supplies may lead to a 36 percent fall in India’s cotton exports in 2021/22 from a year ago. This may support global cotton prices, which recently jumped to its highest levels in a decade on account of strong demand from top consumer China.
Sumeet Mittal, General Manager-India, Louis Dreyfus Company says, India’s exports may decline to 5 million bales in the new season as demand in the local market has been increasing. In 2020-21, India exported around 7.8 million bales, the highest in eight years, as the state-run Cotton Corporation of India continuously sold from its warehouses keeping Indian prices competitive, he informs. Higher exports and local demand have depleted carry forward stocks to 6.5 million bales in the new season that started on October 1, from 12.5 million bales a year ago.
Good demand from local mills and a rally in global prices have lifted domestic prices MCOTc1 to a record high this week, tapering the advantage India had over other suppliers. Leading cotton producing states including Gujarat, Maharashtra, Telangana and Andhra Pradesh received heavy rainfall in September. This could impact the early-sown crop in all these states, adds Chirag Patel, Chief Executive Office, Jaydeep Cotton Fibers.