The Hindu Business Line : Cotton trade in South keen on direct imports

SEAMLESS trade opportunity, which the quantitative restriction-free textile trade is expected to bring in, seems to be encouraging cotton trade in inter-land markets such as Coimbatore to try direct trade dealings with international cotton shippers/suppliers.

Cotton merchants, who all along operated largely through Mumbai-based principal agents to import cotton for the local market, have of late sought to expand their trade horizons by exploring the scope of importing cotton directly from international shippers.

"We have to look for direct import of cotton as there is great scope for this. And the month-end meet of the International Cotton Advisory Committee in Mumbai may provide a good opportunity for Coimbatore-based cotton trade to explore possibilities for direct imports," according to some Coimbatore-based cotton merchants.

According to them, about 10 per cent of imported cotton supplied for textile consumers in Coimbatore and Madurai regions are directly imported by the local cotton trade and they expect this share to go up in the coming months, considering that global cotton output which is on the higher side this year will further facilitate easy imports.

Moreover, local cotton traders say the direct negotiation by Coimbatore merchants with international cotton shippers would help meet the southern textile mills' fibre needs such as identifying station-specific cotton crop, the quality of cotton and the contractual terms including the terms of the letter of credit - as there had been difficulties in the past when importers were booked through Mumbai principal agents.

The Coimbatore cotton trade, which is set on procuring cotton from Andhra Pradesh and Karnataka, is also eyeing the Pakistan market for long staple cotton export.

Since Pakistan largely produces medium and short staple cotton varieties, there has been a good demand for these for spinning the finer (60s/80s/100s) count range of yarn.

This way, they believe the long staple varieties, such as MCU-5, Suvin, Bunny and the DCH cottons, produced from south-based cotton tracts in Andhra Pradesh and Karnataka, would find favour with Pakistani spinners who too are set on modernising their production lines.

A team of Coimbatore-based cotton merchants/agents visited China, the world's largest cotton growing and consuming country, early this year, to keep themselves abreast of the latest trade trends.

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