Home / Knowledge / News / Textiles / NAFED may intervene if cotton prices slip below MSP
NAFED may intervene if cotton prices slip below MSP
Nov '11
India is expecting a bumper cotton crop in the new season which has recently begun. In order that domestic prices do not slip below the minimum support price (MSP) mandated by the Indian government, National Agricultural Cooperative Marketing Federation of India (NAFED) is mulling to take up a market intervention initiatives.

NAFED will be undertaking market intervention program after a period of two years and towards that end has informed its top officials to carry regular assessments of cotton price trends mainly in the cotton producing states like Gujarat, Maharashtra, Punjab, Andhra Pradesh and Haryana.

Currently cotton prices are ruling over the MSP announced by the government. The MSP for 2011-12 for cotton farmers for long staple type variety of cotton is Rs 3,300 per quintal and for medium staple quality; it is Rs 2,800 per quintal.

Giving details about the need for market intervention, a senior official of the cotton division of NAFED told fibre2fashion, “We have a bumper cotton crop this time and the output is estimated to be around 35-36 million bales (1 bale = 170 kg). Due to this the prices will surely see a downward trend.

“Prices are expected to fall after November. But if China's policies remain same and they import more this time, then cotton exports will get boost from India. We are hopeful that about 7-8 million bales of cotton can be exported. So, we are waiting for them to declare their policies for cotton imports from India.

“The dollar is weak currently and hence exports are lower to European countries where mainly yarn is exported. In such a situation, expectation of exports to the European region is less. The Government of India, along with the Cotton Corporation of India (CCI), has made NAFED a procuring agency for cotton procurement. So, if prices move downward, NAFED will do the procurement as per the government's policies”.

“If prices fall below the MSP, then the government agencies purchase the cotton at the MSP so that the prices remain stable and do not fall below a certain value, so that farmers do not incur losses. The MSP is decided keeping in mind the cultivation costs of farmers and making sure the farmers are not on the losing side. This also encourages the farmers to keep producing more and more cotton in their fields.

“After procurement, the cotton is processed further viz. ginning, pressing, etc. and sold as per the norms of CCI”, he concluded by saying.

Fibre2fashion News Desk - India

Must ReadView All

Courtesy: Stone Island

Apparel/Garments | On 25th Jun 2018

Stone Island has mastered ingredient branding: Braind

Italian high-end men's apparel brand Stone Island tops the list of...

Courtesy: Tecnorama

Textiles | On 25th Jun 2018

'Tecnorama automatic dyeing system offers efficiency'

Italy based Tecnorama’s fully-automatic machinery for dispensing...

Courtesy: Lenzing

Textiles | On 25th Jun 2018

Lenzing launches Veocel nonwoven speciality brand

Leading fibre company, the Lenzing Group has unveiled Veocel, the new ...

Interviews View All

Hannah Lane

Encouragement from brands will motivate supply chains to become more...

Abhishek Ganguly
Puma India

‘As a brand, Puma is always looking for new and innovative ways to inspire ...

Poojaa Kumar Deepak

Zeven's performance sports apparel is designed for the Indian body type,...

Anupam Arya

<div>Jaipur-based Fabriclore Retailing Pvt. Ltd. is attempting to revive...

Karan Behal

Karan Behal, founder and chief executive of top-selling brand...

John Kelley

Textile Events is one of the largest textile fair in the United Kingdom,...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Sidharth Sinha
Sidharth Sinha

<b>Sidharth Sinha</b> has contributed to the successful rebirth and...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

June 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category

Related Categories:

Advanced Search