Cotton farmers in India have been advised to sell their crops immediately after harvest without waiting for any rise in prices.
According to an analysis by Tamil Nadu Agricultural University's (TNAU) Domestic Export and Marketing Intelligence Cell (DEMIC), there are very few chances of a rise in cotton prices, rather they are more likely to decline, if China, a key buyer of Indian cotton, discontinues buying.
After witnessing a downward trend for almost 10 months, world cotton prices stabilized in January this year with Chinese purchase playing a major part.
Cotton prices in India are likely to remain stable, overlooking factors like a drop in domestic consumption, higher productivity, power outages and waning cotton seed prices, provided there is strengthening of the dollar and continued buying by China.
The Bt cotton (long staple) varieties sown during August-September 2011, which are now arriving in the markets, are likely to fetch a price of Rs. 3,900 to Rs. 4,200 per quintal to the farmers, during the next three months.
According to DEMIC's analysis, the long staple cotton sown during February-March (Masipattam) is likely to reap a price of Rs. 4,300 to Rs. 4,600 per quintal, upon arrival in the market during June-September 2012. It thus, advises farmers to take up cultivation of the crop.
As per the analysis, with an anticipated rise of 14 percent, India, the world's second biggest cotton producer, is likely to export around eight million bales of cotton this year, and has already shipped 4.6 million bales so far.
By March end, the country's exports are likely to reach 5.5 to 6 million bales, the analysis said.
Fibre2fashion News Desk - India
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