High quality cotton prices witness decline due to good rains

12 Aug '08

2 min read

Sankar – 6, the most popular Bt cotton variety of Gujarat has recently witnessed a price decline due to good down pours across the state.

Last week prices stood at Rs27,700 a candy, down by Rs 400 from the previous close. Prices are likely to fall even further to Rs26,000-26,500 a candy in the next 10-15 days as mills are not ready to purchase cotton at such high levels.

However, market experts are confident that prices for Sankar – 6 variety will not fall beyond Rs26,500 during this month due to insufficient stocks.

In the period between October 2007 - July 2008, prices of Sankar – 6 in Gujarat touched a record high of Rs28,000-28,500 a candy, against the average price last year of Rs20,000-21,000. Even Governmental measures like scrapping of 10 percent import duty on cotton and eliminating 1 percent incentive on exports, did not help in bringing down the prices.

So grave was the situation that before rainfall, there was a widespread fear that cotton sowing in Gujarat would miss the target of 2.45 million hectares this Kharif season. But with monsoons blessing the state in the recent times, traders are now sure that the target can be easily met.

Reputed for being the largest cotton producing state in India, Gujarat gave an output of 11.5 million bales out of a total of 31.5 million bales produced in the 2007-08 season.

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