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Cotton

Cotton candy prices fell by 0.44%, settling at 56,110, as the yarn market faced sluggish demand and payment challenges. The USDA recently lowered India’s cotton production estimate for the 2024-25 season to 30.72 million bales, with ending stocks also reduced to 12.38 million bales due to crop damage from excessive rains and pest issues. Meanwhile, global cotton production is projected to increase by over 200,000 bales, driven by rises in China, Brazil, and Argentina, which are expected to offset declines in the U.S. and Spain. This season, India’s cotton acreage dropped by approximately 9%, attributed to shifts in cropping patterns, with farmers in Gujarat opting for groundnuts over cotton for better returns. India’s cotton production is forecasted to decrease by 7.4% to 30.2 million bales, prompting expectations of higher imports at 2.5 million bales, up from 1.75 million last year, while exports are projected to decline to 1.8 million bales. This shift is likely to lend support to global prices, as India, the world’s second-largest cotton producer, may reduce its export volume. Additionally, steady domestic demand for cotton at 31.3 million bales is anticipated for 2024-25, despite supply constraints. The U.S. cotton balance sheet for 2024-25 reflects lower production, mill use, and exports, with production impacted by Hurricane Helene. Global ending stocks have slightly declined to 76.3 million bales, with trade down by over 500,000 bales primarily due to reduced imports by China. Technically, the cotton candy market is experiencing long liquidation with stable open interest, while prices fell by 250 rupees. Support is positioned at 55,870, with further downside potentially testing 55,640, while resistance stands at 56,360, with a breakout above this level possibly pushing prices to 56,620.

BUY COTTONCANDY NOV @ 55800 SL 55500 TGT 56200-56600. MCX

Cocudakl

BUY COCUDAKL DEC @ 2920 SL 2870 TGT 2980-3020. NCDEX

Kapas

BUY KAPAS APR @ 1540 SL 1525 TGT 1560-1575. NCDEX