Agri Business

‘Brisk demand’ from mills to lift cotton consumption in 2020-21: CAI

Our Bureau Ahmedabad | Updated on August 14, 2021

USDA sees cotton area this year being taken over by lentils, pulses and soyabean

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India's cotton consumption for the year 2020-21 is likely to remain firm as traders body Cotton Association of India (CAI) sees brisk demand coming up from the millers.

In its July estimates, the Cotton Association of India (CAI) has projected cotton consumption to be higher by 5 lakh bales to 330 lakh bales (each of 170 kg) for the year 2020-21.

The Crop Committee of the CAI has made this revision considering the brisk demand for cotton yarn despite disruptions caused on account of the lockdown implemented to arrest the second wave of Covid-19 pandemic, it said after the committee's meeting on August 11.

Cotton output estimate

On the production side, CAI has reduced the cotton output estimate for the year 2020-21 to 354.5 lakh bales as against the previous estimate of 356 lakh bales. Imports are likely to be at 10 lakh bales, but the exports are likely to rise by 5 lakh bales to 77 lakh bales, “based on the input received from exporter-members,” CAI noted.

The arrivals between October 2020 to July 2021 are estimated at 348.61 lakh bales compared with the projected output of 354.5 lakh bales.

Meanwhile, the US Department of Agriculture (USDA) has noted a shift in crop pattern for the current kharif season.

It noted that Cotton area in Gujarat "is making way for increased plantings of lentils and soyabeans. Similarly, Maharashtra is seeing expanded plantings of soyabeans, sugar, and pulses (especially urad/black gram). However, in Karnataka and Odisha the cotton planting is replacing paddy rice acreage.

In its forecast for the year 2021-22, USDA estimated cotton output at 29 million US bales (363.66 lakh Indian bales of 170 kg each ) on an area of 12.9 million hectares. "Kharif cotton planting is now underway in central and southern India as the two-week monsoon delay has been followed by intense rains across the major cotton producing states," the report said.

“With market arrivals slowing, seed cotton prices are rising. Mill consumption is good at 25.5 million bales (320 lakh Indian bales) buoyed by strong export orders, and the recent government announcement of a three-year extension of the Rebate of State and Central taxes and Levies (ROSCTL) scheme for the export of apparel/garments and made-ups,” added the report, which was released on August 6, 2021.

Crop condition would remain a challenge for the farmers as the season progresses. In northern states of Punjab and Rajasthan, the cotton crop is in its flowering/vegetative stage.

"Farmers are being advised to keep cotton fields free from weeds. They are told to monitor for whitefly infestation, since conditions are favourable for whitefly as well as for green teal and thrips infestation," the USDA report noted.

Published on August 13, 2021

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