India will retain its position as an important cotton producer, globally. According to the latest estimates by United States Department of Agriculture (USDA), India’s cotton crop production is estimated at 305 lakh US bales (each of 217.7 kg), which works out to 390 lakh India bales (each of 170 kg) for the marketing year 2019-20.
As per the Cotton Association of India (CAI), India’s cotton production was reported to be decade-low standing at 312 lakh bales in last season in 2018-19.
USDA stated in its international outlook on cotton crop, which was released on October 15, 2019, “Production in India – the leading cotton producer – is forecast at 30.5 million bales, 15 per cent above 2018-19, and the second highest on record, as both area and yield in 2019-20 are expected higher. Harvested area in India is projected at a record 12.9 million hectares in 2019-20, as domestic prices and internal support price prospects favour cotton over competing crops.”
The report also pointed out that the “recent above-average monsoon rainfall will likely provide an extended picking season, which is expected to increase the yield to a 3-year high.”
Though the Indian cotton trade bodies are yet to release their own cotton estimate. The first advance estimate release by the Government of India has predicted the cotton crop in the country to be at 322.7 lakh bales.
The India grew cotton at 127.6 lakh hectares, which is about 6 lakh hectares more than the last year for the Kharif season.
The cotton prices soared at Rs 41,900 (US$ 600) per candy (each of 356 kg) of ginned cotton with 29 mm variety, which was Rs 43,900 (US$ 630) two months ago. According to the ICE futures for December 2019, International cotton prices quoted at 60.83 cents per pound on.
According to the USDA, cotton consumption in India is expected to increase by 3 per cent, to 247.5 lakh US bales (each of 217.7 kg) in 2019-20. This rise is about 316.9 lakh Indian bales (each of 170 kg) that is equal to the record set in 2015-16.
India has attracted the global cotton players with its record production and increase in stock situations, to provide the world cotton market.
“India’s increased stock expectations to 134 lakh US bales (or 171.6 lakh India bales) associated with the higher production forecast-contribute significantly to this season’s global stock gain…For India, this season’s projected larger crop is expected to provide an additional 500,000 bales (or 6.4 lakh Indian bales) of exports, with cotton exports rebounding to 4.0 million bales in 2019-20,” the USDA report stated.
The USDA estimation have hinted an expansion in the exports during 2019-20 in countries like Brazil, India and the Unites States.
The overall global production of the cotton is projected at 124.8 million US bales, which is about 5.8 million bales (or 5 per cent) above 2018-19. The October production estimate includes decreases for Brazil, Pakistan, Australia, and the United States, which more than offset an increase for India.
Source: IBEF
Image Courtesy: The Hindu Business Line
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