India’s cotton output is expected to increase by 15% in 2022/23, because the planting area will increase by 8%, the weather and growth environment will be good, the recent rainfall will gradually converge, and the cotton yield is expected to increase.
In the first half of September, the heavy rainfall in Gujarat and Maharashtra once caused market concern, but by the end of September, there was only sporadic rainfall in the above areas, and no excessive rainfall. In northern India, the new cotton during harvest also suffered from unfavorable rainfall, but except for a few areas in Hayana, there was no obvious yield reduction in northern India.
Last year, the cotton yield in northern India was seriously damaged by cotton bollworms caused by excessive rainfall. At that time, the unit yield of Gujarat and Maharashtra also decreased significantly. So far this year, India’s cotton production has not faced an obvious threat. The number of new cotton on the market in Punjab, Hayana, Rajasthan and other northern regions is steadily increasing. By the end of September, the daily listing of new cotton in the northern region has increased to 14000 bales, and the market is expected to increase to 30000 bales soon. However, at present, the listing of new cotton in central and southern India is still very small, with only 4000-5000 bales per day in Gujarat. It is expected that it will be very limited before the middle of October, but it is expected to increase after the Diwali Festival. The peak of new cotton listing may start from November.
Despite the delay in listing and the long-term shortage of market supply before the listing of new cotton, the price of cotton in northern India has dropped sharply recently. The price for delivery in October fell to Rs. 6500-6550/Maud, while the price in early September fell by 20-24% to Rs. 8500-9000/Maud. Traders believe that the pressure of the current cotton price decline is mainly from the lack of downstream demand. Buyers expect cotton prices to fall further, so they do not purchase. It is reported that Indian textile mills only maintain very limited procurement, and large enterprises have not yet started procurement.
Post time: Oct-15-2022