Farmers retain 15lac bales of seed cotton to date

31 Mar '11

2 min read

White gold of the textile industry remains ruling firm. Seed Cotton futures for March, on the National Commodity & Derivatives Exchange (NCDEX) stood at Rs 1196.2/20kg and for April the high price touched Rs 1235.9/20kg (on Wednesday).

Speaking with Fibre2fashion, Mr. Manubhai Shah, Director of Surendranagar Cotton and Cotton Oil Seeds Association, informs - “The production for the current season in seed cotton will touch 3 crore bales overall India, and Gujarat alone will contribute 1 crore bales in this. In Surendranagar the production touched 17-18 lakhs bales.”

He also assures that the stock is still arriving and there is no dearth of supply, however the farmer shall hold the stock till June end to get good prices. “Prices are likely to rise still,” he confirms.

Mr. Manish Patel, Director, Dhanlaxmi Cotton Co. – a trading firm, claims “Still around 15% seed cotton is with the farmers.”

He informs that basically last year seed cotton price was around Rs. 700 per 20kg which this year reached almost Rs.1400 per 20kg. Still at these doubled rates also farmers are reluctant to sell.

“Compared to last year this time crop is four times more. Consumption is 10-20% higher than compared to last year. However, our farmers are going greedy expecting a bit more” analyses Mr. Patel.

Mr. Patel also finds that as and when the export prices are higher, larger share of Indian seed cotton is exported mostly to Dubai and other countries. Millers from all the mills, in particularly in North India, do not have enough stock and they want to purchase but they have to spend around Rs. 60-65 thousand for a candy(356kg), which is a very big cost.

Suggesting a way out of this situation, a ginner and exporter- MD of Asha Cotton Industries, Mr Paresh Valia recommends “We expect government to allow 15lacs cotton bales for exports(Last date of export is 30/9/11), and give yarn export on OGL (Open general Licence) (Last date of shipment is 30/9/11), because if government gives permission, then market of cotton goes upper side, so raw cotton price also goes high, so farmer get higher prices. Therefore, I think in Gujarat farmers are holding 12-15 lacs bales of seed cotton.”

Fibre2fashion News Desk - India

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