21-03-2024 10:38 AM | Source: Kedia Advisory
India's Cotton Surge: Record Production and Rising Demand Shape Market Dynamics by Amit Gupta, Kedia Advisory

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India's cotton production for the 2023-24 season soars to 309.70 lakh bales, surpassing initial estimates and indicating a robust market. With domestic demand on the rise, including a significant jump in MSME consumption, the surplus cotton remains ample despite a slight decrease. Additionally, exports are expected to climb, reflecting the nation's growing influence in the global cotton market.



Cotton Production Up: The Cotton Association of India (CAI) has revised India's cotton production estimates upwards to 309.70 lakh bales for the current season, compared to the initial estimate of 294.1 lakh bales. Last year, production was estimated at 318 lakh bales.

Total Availability: The total availability of cotton for the current season is projected at 359 lakh bales, including the balance stock from last season and imports, higher than the 355.40 lakh bales available in the 2022-23 season.

Domestic Demand: Total domestic demand has risen to 317 lakh bales, up from 311 lakh bales last year. MSME consumption has jumped from 15 lakh bales to 100 lakh bales.

Surplus and Exports: The surplus cotton is estimated at 42 lakh bales this season, slightly down from 44 lakh bales last year. Cotton exports could increase to 22 lakh bales, up from 15.50 lakh bales last year.

Arrivals and Procurement: From October 1, 2023, to February 29, 2024, cotton arrivals are estimated at 226.82 lakh bales. The Cotton Corporation of India (CCI) has procured approximately 33 lakh bales up to 29 February this year.

Production Capacity and Stocks: Ginning mills in central and north India are operating at full capacity, while those in south India are at 75-80 per cent capacity. Indian spinning mills are running at 90 per cent production capacity. Indian mills had a cotton stock of 42 lakh bales by the end of February 2024, sufficient for about 45 days of consumption.



India's cotton sector demonstrates resilience and vitality, with record production levels and evolving market dynamics. Despite global challenges, the industry maintains stability, driven by increased domestic demand and expanding export opportunities. As production continues to exceed expectations and domestic consumption patterns evolve, India solidifies its position as a key player in the international cotton trade, promising continued growth and prosperity for stakeholders across the supply chain.