Increased production reduces cotton prices by 8-10%
03 Nov '06
2 min read
Prices of cotton yarn in India, which increased by 15 to 20 percent in past three months owing to shortage, dropped by a small margin of 8 to 10 percent because of increased cotton production in India and China.
Both countries have obtained greater production this year. As China had bulk imports from India to make up for previous season's production shortage, current season's cotton exports reached 45 lakh bales which is much more than regular export of 10 to 15 lakhs bales.
Between October 2006 and September 2007, cotton production is estimated to be around 275 lakh bales. Total arrivals comprising carry over stock of 57 lakh bales are anticipated to be 332 lakh bales.
Total arrivals in the previous season amounted to 323 lakh bales, with production of 247 lakh bales, carry over stock of 72 lakh bales and import of 4 lakh bales, informed South India Mill Owners' Association (SIMOA).
National Development and Reforms Commission (NDRC) stated that in China, current season's cotton production is anticipated to rise by 10 percent to 6.5 metric tons as against last year, while demand is expected to be 10.2 metric tons.
International Cotton Advisory Committee (ICAC) has increased its estimation of global cotton production by 3,30,000 tons to 25 metric tons from 24.67 metric tons in 2005.
S K Viswanthan, Secretary, South India Cotton Association, said cotton exports would rise to 60 lakh bales in this season from last year's 45 lakh bales.
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