CAI Revises Cotton Output, Consumption Estimates for 2024-25 by Amit Gupta, Kedia Advisory
The Cotton Association of India (CAI) has revised its 2024-25 cotton output projections upwards by 2 lakh bales, taking the total estimate to 304.25 lakh bales. The upward revision is driven by increased production in Telangana. The consumption estimate has also been raised by 2 lakh bales due to rising demand. Despite high arrivals, cotton prices remain range-bound, with daily arrivals averaging over 1.5 lakh bales. The Cotton Corporation of India (CCI) is the major buyer, influencing the market. Exports mainly to Bangladesh are continuing, but at a slower pace. CCI holds substantial stocks, creating market stability.
Key Highlights
* CAI revises 2024-25 cotton output upwards by 2 lakh bales.
* Telangana’s cotton production estimate increased by 6 lakh bales.
* Cotton consumption forecast raised by 2 lakh bales to 315 lakh bales.
* Cotton exports primarily to Bangladesh, with moderate pace.
The Cotton Association of India (CAI) has updated its projections for the 2024-25 cotton season, increasing both the output and consumption estimates. The cotton output for the season is now expected to reach 304.25 lakh bales, which is 2 lakh bales higher than previous estimates. This upward revision is largely driven by a robust cotton crop in Telangana, which has seen a significant increase in production by 6 lakh bales, bringing the total to 42 lakh bales. In contrast, production in North India is expected to decline by 3.5 lakh bales.
Despite these increases, the prices of cotton remain stable, hovering in the range of Rs.53,000-54,000 per candy of 356 kg. Demand for cotton has been steady but not overwhelming, as textile mills are buying on a need basis, keeping their stock for only two to three months. The Cotton Corporation of India (CCI) continues to be the dominant buyer in the market, having procured a substantial portion of the cotton arrivals. This has created a situation where the state-run entity holds large stocks, keeping mills from rushing into purchases.
On the export front, cotton shipments are primarily directed towards Bangladesh, but the pace of exports remains moderate. As of January 22, the cumulative market arrivals have exceeded 156 lakh bales, with more than half of these having been procured by CCI. This reflects a balanced market situation where the supply and demand dynamics remain stable.
Finally
With steady prices and strong demand in key markets, the cotton outlook for 2024-25 remains positive, supported by stable arrivals and the CCI’s market role.
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