Economy

Cotton body's revised figures raise a storm

| Updated on: Apr 19, 2012
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The closing stock for the current season as projected by the Cotton Advisory Board is seen as a worrying issue for the textile industry.

At its meeting in Mumbai on Wednesday, the Board had projected the closing stock for this season ending September at 25.1 lakh bales (of 170 kg each).

“This is equal to five-six weeks' consumption. For a healthy survival of the textile industry, stock that can last 10 weeks is required,” said Mr A. Ramani, a cotton analyst.

The closing stock estimated by the Board, which has representation from growers, traders, exporters, textile mills and the Government, is sharply down from its earlier projection of 55.3 lakh bales made on January 24.

Besides, the Board raised the crop projection to 347 lakh bales (345 lakh bales) and export estimate to 115 lakh bales (84 lakh bales). As a result, demand or disappearance has been projected at 367 lakh bales against an earlier estimate of 344 lakh bales.

The higher estimate of disappearance is on account of record export of 115 lakh bales. Cotton consumption by large textile mills this season has been pruned to 211 lakh bales from 215 lakh bales and that of small mills to 21 lakh bales from 24 lakh bales.

However, what seems to have sparked a controversy are figures put out for last season that ended in September.

According to the Board, exports last year have been now pegged at 78 lakh bales against 68.8 lakh fixed in January.

The Board has pegged last season's export higher based on actual physical exports data sent by the Commerce Ministry, according to sources. In view of this, the closing stock of last season has now been put at 39.1 lakh bales against 48.3 lakh bales.

Subsequently, last season's disappearance has been revised upwards to 345.5 lakh bales.

According to Mr Dhiren N. Sheth, President of Cotton Association of India, the revision has raised concerns over the accuracy of last year's figures.

“This season, production, consumption and imports are higher. The figures of last year will have to be revisited,” he said.

The Board figures is the latest issue on which the Government, the trade and exporters are at loggerheads.

Already, the Government, on the one side, and traders and exporters, on the other, are locked in a tussle over curbs on exports. The Centre initially banned exports in March. However, following protests from growers and traders, it decided to allow only those quantities that had been registered for exports. It is still firm in not giving permission to new registrations for cotton shipments

>mrsubramani@thehindu.co.in

Published on March 12, 2018

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