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COTTON

Cotton prices surging by 1.17% to settle at 62320 amid a combination of global supply shortages and increased demand has been instrumental in driving this upward momentum. Severe cold weather in China has disrupted the crop cycle, while reduced acreage in the US has further compounded the shortage of cotton in the global market. The latest World Agricultural Supply and Demand Estimates (WASDE) report from the USDA indicates a tightening of the US cotton balance sheet for the 2023/24 season, with lower ending stocks and higher exports. This has prompted concerns among textile mills, with the Southern India Mills’ Association (SIMA) advising against panic buying despite rising prices. However, global supply is expected to improve post-July, offering some relief to the market. On the global front, the USDA's February WASDE report forecasts a slight decrease in world cotton production for the 2023/24 season, with reductions in Australia and Benin partly offset by smaller increases elsewhere. Despite this, world cotton ending stocks are expected to decrease due to lower beginning stocks and production. India's cotton exports have surged in February, reaching the highest level in two years, driven by competitive pricing and increased demand from Asian buyers, particularly China, Bangladesh, and Vietnam. From a technical perspective, the market is witnessing short covering, with a drop in open interest by -3.76% while prices continue to rise. Cottoncandy finds support at 61800, with potential testing of 61270 levels below, while resistance is likely at 62660, with a possible move towards 62990 if breached.

BUY COTTONCANDY MAR @ 62000 SL 61800 TGT 62400-62600. MCX

COCUDAKL

BUY COCUDAKL MAR @ 2680 SL 2640 TGT 2730-2760. NCDEX

KAPAS

BUY KAPAS APR @ 1640 SL 1620 TGT 1660-1675. NCDEX