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COTTON

Cotton prices experienced a slight decline yesterday, settling down by -0.96% at 62040, driven by profit booking activities following earlier gains. This came in the wake of the latest U.S. cotton forecasts for the 2023/24 season, which showed lower production and ending stocks compared to the previous month's estimates. Reduced production in the U.S., reflected in the March 8 Cotton Ginnings report, led to a decrease of 334,000 bales to 12.1 million, while ending stocks were lowered by 300,000 bales to 2.5 million. Despite this, the projected marketing year average price received by upland producers remained unchanged at 77.0 cents per pound. On the global front, cotton supply and demand estimates for 2023/24 indicated higher production, consumption, and trade, albeit with lower ending stocks. While production was slightly higher due to increased output in India, consumption saw a significant rise driven by China and India. World trade also saw an uptick, with higher imports projected for China, India, Australia, and Turkey. However, ending stocks witnessed a marginal decline, indicating a tighter market scenario. Meanwhile, the Southern India Mills’ Association (SIMA) advised textile mills in southern States to avoid panic buying of cotton. The recent surge in domestic cotton prices prompted caution, with prices of the widely-used Shankar-6 variety reaching almost ?62,000 a candy from ?55,300 two weeks prior. The Committee on Cotton Production and Consumption estimated production for the current season at 316.57 lakh bales, with imports at 12 lakh bales and domestic consumption at 310 lakh bales. Despite increased capacity utilization at mills and significant contracts for exports, concerns lingered regarding the sustainability of export demand as domestic prices approach international levels. In Rajkot, a major spot market, cotton prices ended slightly lower at 29482.05 Rupees, dropping by -0.05 percent. From a technical perspective, the market observed fresh selling, with a gain in open interest by 0.84%. Currently, Cottoncandy finds support at 61740, with a potential downside to 61450, while resistance is likely to be encountered at 62500, with a breakthrough potentially leading to prices testing 62970 levels.

SELL COTTONCANDY MAR @ 62400 SL 62800 TGT 61900-61600. MCX

COCUDAKL

SELL COCUDAKL APR @ 2760 SL 2800 TGT 2710-2670. NCDEX

KAPAS

SELL KAPAS APR @ 1635 SL 1655 TGT 1610-1600. NCDEX