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Cotton

Cotton yesterday settled up by 0.24% at 21130 on short covering after prices dropped as pressure seen after the Union Ministry of Textiles’ Committee on Cotton Production and Consumption (COCPC) has projected a higher crop at 371 lakh bales (each of 170 kg) for the year 2020-21. Cotton trade had estimated the crop size at 358.50 lakh bales. In its meeting, the Committee, estimated the average cotton yield of 486.76 kg per hectare, up from 463.99 kg reported in the previous year. For the previous year, projected cotton crop size of 365 lakh bales in the country. As per the latest projections, Gujarat will be the largest cottongrowing State with 90.5 lakh bales and one of the highest yields at 676.86 kg per hectare. Rajasthan, with 27 lakh bales, is expected to have highest cotton yield at 683.04 kg. Besides Gujarat, the top three cotton growing states include Maharashtra with 86 lakh bales with 349.43 kg yield and Telangana with 60 lakh bales and 429.84 kg of cotton yield. Commenting on the cotton crop projections, J Thulasidharan, Chairman of Indian Cotton Federation, said that a higher crop would pose a serious challenge for India to clear huge stocks of the fibre crop. As per the government estimate, closing stock for 2020-21 is likely to be 97.95 lakh bales, as comapred to 120.95 lakh bales recorded last year. In spot market, Cotton dropped by -30 Rupees to end at 20850 Rupees. Technically market is under fresh buying as market has witnessed gain in open interest by 0.44% to settled at 6590 while prices up 50 rupees, now Cotton is getting support at 21050 and below same could see a test of 20980 levels, and resistance is now likely to be seen at 21170, a move above could see prices testing 21220.

Trading Idea for the day

Cotton trading range for the day is 20980-21220.

Cotton gains on short covering after prices dropped as pressure seen after COCPC crop estimate is higher by 12.5 lakh bales

The Committee, estimated the average cotton yield of 486.76 kg per hectare, up from 463.99 kg reported in the previous year.

For the previous year, projected cotton crop size of 365 lakh bales in the country.

Technical Chart

Cocudakl

Cocudakl yesterday settled up by 2.47% at 2159 on short covering after prices dropped as just four months after Cotton Corporation of India (CCI) started procurement in all its 400 centres across the country, the operations have stopped in over 300 centres as kapas (raw unginned seed cotton) prices in most mandis in major cotton producing states have crossed the government-declared minimum support price (MSP) of Rs 5,825 per quintal. The government-owned corporation had to wade in at the beginning of the cotton marketing season (October to September) 2020-21 to begin procurement. PK Agarwal, chairmancum-managing director of CCI, said, to date, they had affected procurement of 87.96 lakh bales of cotton from 18.02 lakh farmers. India, the world’s biggest cotton grower, imposed a 10% duty on imports of the fiber to help farmers, Finance Minister Nirmala Sitharaman said. The tax comprises a basic customs duty of 5% and an additional 5% levy to finance the development of agricultural infrastructure in the country, according to the budget documents. India’s cotton output may climb to 37.12 million bales of 170 kilograms each in 2020-21, from 35.49 million bales a year earlier, according to the farm ministry. Imports are expected to fall to 1.4 million bales this year from 1.55 million bales in 2019-20, according to the Cotton Association of India. In Akola spot market, Cocudakl dropped by -4.95 Rupees to end at 2200 Rupees per 100 kgs. Technically market is under short covering as market has witnessed drop in open interest by -12.34% to settled at 69770 while prices up 52 rupees, now Cocudakl is getting support at 2121 and below same could see a test of 2084 levels, and resistance is now likely to be seen at 2182, a move above could see prices testing 2206.

Trading Idea for the day

Cocudakl trading range for the day is 2084-2206.

Cocudakl gained on short covering after prices dropped as CCI stops procurement in over 300 centres

India’s cotton output may climb to 37.12 million bales of 170 kilograms each in 2020-21, from 35.49 million bales a year earlier

India, the world’s biggest cotton grower, imposed a 10% duty on imports of the fiber to help farmers

Technical Chart

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