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The Committee on Cotton Production and Consumption (CCPC) forecasts a rise in the current season's cotton crop to 323.11 lakh bales, with exports projected to surge to 27 lakh bales. Amidst increased demand driven by rising international prices, Indian cotton prices maintain a competitive edge, with ICE May futures at 93.33 US cents per pound and Shankar-6 variety quoted at ?61,500 per candy. Furthermore, the CCPC anticipates a reduction in carryover stocks to 52.27 lakh bales, signaling optimism for market stability and growth.

Highlights

Higher Crop Projection: The Committee on Cotton Production and Consumption (CCPC) has raised the cotton crop projection for the current season (October 2023-September 2024) to 323.11 lakh bales, compared to 316.57 lakh bales estimated previously.

Lowered Previous Season's Production: Last season's crop production has been revised downward to 336.60 lakh bales, from the earlier estimate of 343.47 lakh bales.

Imports and Exports: Imports for the current season remain unchanged at 12 lakh bales, while exports are projected to increase to 27 lakh bales, compared to 15.89 lakh bales last season.

Supply and Consumption: Opening stocks are projected at 61.16 lakh bales, leading to an overall supply of 396.27 lakh bales for the current season. Consumption is estimated at 317 lakh bales, including small spinners and non-textiles.

Price Dynamics: Indian cotton demand has risen due to increased prices on the Intercontinental Exchange (ICE), New York, with domestic prices now quoted at a discount to ICE futures.

Price Comparison: ICE May cotton futures are approximately 93.33 US cents per pound, while the Shankar-6 variety in Rajkot is priced at ?61,500 per candy.

Carryover Stocks: The CCPC has reduced the carryover stocks estimate to 52.27 lakh bales from the previous estimate of 57.65 lakh bales.

Conclusion

The CCPC's projections indicate a promising outlook for the Indian cotton industry, with increased production and exports poised to capitalize on favorable international market conditions. The competitive pricing of Indian cotton compared to global benchmarks enhances its attractiveness in the global market, fostering opportunities for expansion and revenue generation. With a proactive approach to supply management and market dynamics, the industry can navigate challenges effectively and sustain growth momentum, benefiting stakeholders across the value chain.

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