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Even as cotton acreage has increased in Gujarat, the State may witness a decline in yield following deficient and delayed rains.
Cotton sowing in the State — the largest grower of the fibre crop — reached 26.5 lakh hectares as on August 6, which is about 10,000 ha more than last year. But a decline in yield will cap the crop size, leading to a further spike in prices.
According to experts, lower yield is also becoming a major concern in other growing regions, such as Maharashtra, where the pink bollworm has surfaced in cotton plants.
“There is definitely going to be an impact on yield due to delay in rains in parts of Gujarat. We are also seeing yields being impacted in States such as Maharashtra due to pink bollworm,” said Atul Ganatra, President of the Cotton Association of India (CAI). He said that India’s average yield is about 550 kg/ha.
“This year, we see yields to be even lower than that, because there is no growth of plants and the crop is suffering because of the lack of rain,” he added.
Looming rain deficit
Cotton growers in Saurashtra and North Gujarat — two key cotton growing regions in the State — have raised an alarm with most of the districts facing deficient rains in the range of 62-88 per cent of the normal rainfall. The scenario last year around the same time was completely different with most of the North Gujarat districts witnessing heavy rains.
Gujarat had received 662 mm rainfall (or 82 per cent of normal) till August 8 last year, while till Wednesday rainfall stood at 454 mm (or 55 per cent) of the season’s normal 831 mm.
“Farmers have not given up hope, but even if it rains now, already about 40 per cent of the season is lost. Delayed rainfall will only brighten prospects for the rabi crop. It won’t help much for kharif,” said Ramesh Bhorania, a farm expert from Rajkot. “There will be a big loss in the cotton crop if it doesn’t rain within a week. There are fears of a lower yield even in other places,” he added.
Cotton balance sheet
For the 10 months (October 2017 to July 2018), CAI has estimated cotton consumption at 270 lakh bales, while exports are seen at 67 lakh bales. The stock at the end of July 2018 is estimated at 63.45 lakh bales. For the entire season ending September 30, 2018, CAI puts the supply at 416 lakh bales. The cotton body has estimated domestic consumption at 324 lakh bales, while the exports are estimated to be at 70 lakh bales. The carry-over stock at the end of the 2017-18 season is projected at 22 lakh bales.
“Prices may remain firm going forward. With the MSP fixed at ₹5,450/quintal, it will come to around ₹47,000-48,000 per candy (of 356 kg). So, if the private players need to purchase, they will have to pay this higher price,” said Ganatra.
Chinese demand
What will further fuel the price rise is Chinese purchases, which are expected to be at about 25-35 lakh bales in November, December and January.
“China’s buying is fuelled by the 25 per cent tax on cotton coming from the US. For India, there will also be demand for about 40 lakh bales from Bangladesh and Vietnam,” he added.
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