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CCI urged to release cotton lint stock at market price

25
Jul '19
Pic: Shutterstock
Pic: Shutterstock
The Indian Cotton Federation (ICF) has urged the Cotton Corporation of India (CCI) to immediately release the cotton lint stock held with it at the ruling market price. In a letter to CCI managing director P Alli Rani, ICF said member spinning mills are not getting quality cotton to meet their demand to cope up with the production of yarn and finished goods.

Lower cotton crop volume has been predicted though the Cotton Advisory Board has projected the production to be 337 lakh bales for the 2018-19 season, with a reasonable carry over stock, ICF president J Thulasidharan said in the letter.

Multiple factors are affecting cotton movement and availability to sustain the continuity of mill consumption with no lay-off for the labour. This usually occurs during this period of the season—April onwards till September—when the supply of raw cotton becomes quite stagnant and low due to low arrivals in the market, which not only reduces the availability of raw cotton for the mills but also increases its prices in the domestic market, Indian media reports quoted Thulasidharan as saying in the letter.

During the last few months, while international prices have fallen by over 25 per cent, Indian prices have corrected by just 5 per cent making lndian spinners totally uncompetitive, the letter said.

Since CCI is still holding about nine lakh cotton bales and offering the same at higher price levels than the Multi Commodity Exchange (MCX) and spot prices through e-auction, ICF should come forward to the rescue of Mill’s operations by offering the cotton lint stock, in support of the cotton consuming mills and with just two months to go for the current season.

“We have reliable feedback that the cotton arrival for the new season may begin by end of October 2019 and also we would also like to bring to your kind notice the fact that China during the off season sells a fixed quantity of raw cotton bales at a market linked prices from their reserve, everyday, to safeguard the spinning industry,” Thulasidharan said.

ICF also requested the chairman to formulate a clear policy on pricing and sale of cotton to ensure that the industry does not have to worry about getting raw cotton bales procured at minimum support price levels by CCI at reasonable level off-season whose advantage is taken by MCX speculators and cotton traders. (DS)

Fibre2Fashion News Desk – India


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