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Cotton

Cottoncandy prices rose by 0.58% to settle at 59,200, driven by concerns over reduced acreage and tightening supplies. In the current Kharif cropping season, cotton acreage has declined by approximately 9% to 110.49 lakh hectares compared to 121.24 lakh hectares in the same period last year. The Cotton Association of India (CAI) estimates this year's acreage at around 113 lakh hectares, down from 127 lakh hectares the previous year. This shift is largely attributed to farmers moving to other crops due to lower yields and high production costs. Additionally, the cotton balance sheet for the upcoming season appears tight, primarily due to higher-than-expected exports to Bangladesh. CAI reports that cotton exports have surged from 15 lakh bales to 28 lakh bales, driven by strong demand from Bangladesh. India's cotton production and consumption for 2023-24 are estimated to be equal at around 325 lakh bales, with exports expected at 28 lakh bales and imports at 13 lakh bales. The gap of 15 lakh bales will be adjusted from last year's stock. Currently, spinning mills hold 25 lakh bales, ginners have 15 lakh bales, and the Cotton Corporation of India holds 20 lakh bales. With an additional 10 lakh bales expected to arrive in August-September, a total of 70 lakh bales will be available for consumption until the end of September. However, any delay in the new crop could create a tighter supply situation. Technically, the market is experiencing short covering, with a 4.19% drop in open interest, settling at 160 contracts, while prices rose by 340 rupees. Cottoncandy is currently supported at 58,830, with a potential test of 58,470 if this level is breached. On the upside, resistance is expected at 59,580, and a move above this could see prices testing 59,970.

BUY COTTONCANDY SEP @ 58800 SL 58400 TGT 59400-59600. MCX

Cocudakl

SELL COCUDAKL SEP @ 3650 SL 3700 TGT 3600-3550. NCDEX

Kapas

SELL KAPAS APR @ 1640 SL 1660 TGT 1615-1600. NCDEX