India Cotton may wilt further on higher arrivals

Cotton prices dropped marginally as export demand slowed on the back of weak global sentiments. Moreover, domestic buying was limited as buyers are expecting prices to drop further in the coming days.

Gujarat Sankar-6 cotton decreased by Rs 100-200 to Rs 40,200-40,300 for a candy of 356 kg. Kapas or raw cotton dropped by Rs 5 to Rs 950-987 for a maund of 20 kg. Kapas for gin delivery was traded at Rs 980-990.

About 60,000 bales (170 kg each) of cotton arrived in Gujarat and 1.60 lakh bales across the country.

Cottonseed prices fell by Rs 5-7 to Rs 350-352 a maund in Rajkot.

Traders said that sentiments in the cotton market are weak as the buying activity is dull.

As the market overseas is treading a negative path, export demand has come down. According to market sources, cotton prices may slip further as they could come under more pressure on increasing arrivals.

Dow Jones reports: Cotton futures retreated on Friday morning, under pressure as traders worried about a possible pullback in demand when China begins to release its stocks.

“Traders have spent much of this month dwelling on the upcoming Chinese auction of state reserves and India’s predicted record crop, and what both could mean for limited import potential in the former and pressure on world prices from the latter,” said Sharon Johnson, senior cotton specialist at KCG Futures in Atlanta.

Cotton for March delivery on the ICE Futures US exchange was recently 1.5 per cent lower at 77.20 cents a pound.