Cotton Arrivals Gather Pace As Rates Stabilise

Natural Fibers

Cotton Arrivals Gather Pace As Rates Stabilise

With rates of cotton crop stabilising in the range of Rs 5,200-5,350 per quintal in Punjab markets, arrival of raw cotton has gone up in the second week of January. 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.

Trade body Indian Cotton Association Limited (ICAL) said raw cotton arrivals were 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 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.

Farmer Ajaib Singh, from Kot Shamir village in Bathinda district who had sown cotton in over eight acres, said he expected to get Rs 3.40 lakh from his total output at the prevailing rates. "I had to spend nearly Rs 2 lakh on the crop so I should be able to make around Rs 1.4 lakh over my expenses this year," he said.

Another cotton grower Gurdev Singh, from Kotbhara village of Bathinda, said, "We will increase the area under cotton in the coming season. During this season our two families had sown the crop on 18 acres and we are satisfied with the returns."

CCI's Bathinda branch head Brajesh Kasana said, "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. Punjab is expected to produce nearly 11 lakh bales, which is short of the initial estimate of 12 lakh bales. The drop in output is due to scanty rains in July-August 2017."