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Cotton

Cotton prices dipped by 0.56% to close at 56,360, pressured by subdued demand in the yarn market and payment constraints affecting transactions. USDA revised India’s cotton production forecast for the 2024-25 season down to 30.72 million bales, and ending stocks were reduced to 12.38 million bales due to damage from excessive rains and pest issues. Global cotton production projections, however, increased by over 200,000 bales, with higher output expected from China, Brazil, and Argentina, offsetting declines in the U.S. and Spain. In India, cotton acreage fell by around 9% year-on-year to 110.49 lakh hectares, mainly as farmers in Gujarat opted to plant groundnuts for better returns. The Cotton Association of India (CAI) forecasts a 7.4% decline in India’s cotton production to 30.2 million bales, likely resulting in increased imports from 1.75 million bales last year to 2.5 million bales, while exports are expected to drop to 1.8 million bales. This decline reflects the ongoing shift in agricultural focus and lower planted area, which fell to 11.29 million hectares from 12.69 million hectares a year ago. On the U.S. front, the cotton balance sheet was adjusted downward due to Hurricane Helene’s impact, reducing production to 14.2 million bales. Lower production and weaker global demand led to reduced U.S. export forecasts for the season. Meanwhile, global ending stocks for 2024-25 saw a slight reduction to 76.3 million bales. Technically, the cotton market experienced fresh selling as open interest rose by 3.65%, pushing prices down by 320 rupees. Key support is now seen at 56,060, with potential to test 55,750 if further pressure persists, while resistance lies at 56,640, and a break above could push prices toward 56,910, signaling cautious sentiment amid mixed global production outlooks.

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 @ 1550 SL 1540 TGT 1560-1570. NCDEX