Cotton rates stabilize with the arrivals gathering pace

With the arrival of raw cotton going up in the second week of January, the rates of cotton crop stabilizing in the range of Rs 5,200-5,350 per quintal in Punjab markets. In the corresponding period in 2017, rates of raw cotton were Rs 5,600-5,700 per quintal.

Till the first week, about 3,000 bales on an average were arriving every day in the state markets. Now, over 4,500 bales are arriving in the mandis for the last three days. Starting from September 1, 2017 till January 9, a total of 5.55 lakh bales (1bale=170kg) of raw cotton had arrived in the markets of Punjab.

As many as 11 lakh bales are expected this season in Punjab as against 8.26 lakh bales in the 2016-17 crop year.

Till December 31, 2017, a total of 526,640 bales had arrived and in the corresponding period in 2016, 4.70 lakh bales had arrived in the markets.
Cotton, which is the second biggest kharif (summer sown) crop of Punjab, was sown over 3.82 lakh hectares this season while the acreage was 2.56 lakh
hectares in 2016.

All purchases are being made by private traders and state-agency Cotton Corporation of India (CCI) is yet to enter the market as the rates of the fibre crop (long staple) is more than the minimum support price (MSP) of Rs 4,220 per quintal.

According to Trade body Indian Cotton Association Limited (ICAL), raw cotton arrivals expected to be 12 lakh bales more than the 2016-17 crop year in the three northern states as the sowing area has increased to 15.41 lakh hectares from 13 lakh hectares, a jump of 16%.
ICAL secretary Jatinder Singh said that cotton output in Punjab, Haryana and Rajasthan was expected to be up 27% as compared to the last season.

As compared to Punjab, cotton arrivals are higher in neighbouring Haryana and Rajasthan. In Haryana, 13.29 lakh bales had arrived till December 31 as against the target of 25 lakh bales.
In Rajasthan, 14.65 lakh bales have arrived till December 31 whereas the target is of over 20 lakh bales.

Area under cotton in Haryana is 6.56 lakh hectares while it was 5.70 lakh hectares in the previous season. Cotton acreage in Rajasthan is 5.03 lakh hectares as against 4.71 lakh hectares in 2016.

Overall, the raw cotton arrivals in north India comprising Punjab, Haryana and Rajasthan stood at 33.23 lakh bales till December 31 against the target of 57.50 lakh bales. The arrivals in these three states in the corresponding period in 2016 were 23.22 lakh bales and the total arrivals were recorded at 45 lakh bales.

In the coming season, the area under cotton is likely to surge. Farmer Ajaib Singh, from Kot Shamir village in Bathinda district who had sown cotton in over eight acres, said that he expected to get Rs 3.40 lakh from his total output at the prevailing rates.

Leading textile manufacture Vardhman Textiles’ director (raw material) I J Dhuria said that cotton scene at the national level seemed good. More farmers in Punjab are expected to sow cotton in the coming season.

CCI’s Bathinda branch head Brajesh Kasana said that the raw cotton prices are stabilising now at Rs 5,200-5,350 per quintal, which, a few days earlier, were below Rs 5,000 per quintal.