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2003-10-14
Fall in cotton prices may be limited in view of strong demand from
domestic mills and exporters besides increase in its global prices.
Forward prices have begun to decline in anticipation of a higher crop but spot prices are still ruling firm, according to sources connected with purchases for spinning mills.
"Prices are a little lower than they were a couple of months ago.
However, they are still higher than the same period last year," the sources said.
For example, data made available by the Cotton Corporation of India (CCI) shows that prices for J-34 are ruling around Rs 19,600 a candy (of 355.56 kg) against Rs 14,400 during the same period last year. Similarly, prices of H-4 are quoting at Rs 22,300 a candy against Rs 16,700 last year and S-6 (Shankar-6) at Rs 22,500 (Rs 17,000). The exceptions are Bengal desi and DCH-32 cotton. Also, prices for the week ended October 7 were Rs 500 a candy lower than the previous week mainly in view of rising arrivals.
"Currently, arrivals are around 15,000 bales (of 170 kg). It will touch 25,000 bales in a week''s time," the sources said.
According to CCI, 72,000 bales have arrived in the markets in Punjab, Haryana, Rajasthan and Gujarat. Small arrivals have been reported in Maharashtra and Madhya Pradesh.
Cotton production is seen bouncing back to 160-165 lakh bales this season (October 2003-September 2004) against 136 lakh bales last season. The Indian Cotton Mills Federation (ICMF) Secretary-General, Mr D.K. Nair, told Business Line that though the crop was expected to be good at 160-170 lakh bales, domestic prices would depend on the international trend.
"International prices are firm and export prospects look good," he
said.
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