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Restricted demand pulled down the price of cotton on Tuesday. Cotton has fallen by Rs 3,000-3,500 a candy of 356 kg in the last seven days.
Sankar -6 variety was traded at Rs 42,000-43,000 a candy for A-grade. Lower-grade cotton was traded at Rs 28,000-30,000 a candy. Raw cotton was traded at Rs 600-900 for a maund of 20 kg. In Gujarat, 10,000-12,000 bales arrived, and 32,000-33,000 in the rest of the country.
A Rajkot-based broker said the market is awaiting the Government's decision on exports. At present, demand is nominal. If the Government allows exports then prices will gain, otherwise they may dip below Rs 40,000 a candy.
The Cabinet Committee on Economic Affairs is likely to review the export decision at a meeting in New Delhi on Wednesday.
The country's cotton acreage is expected to increase by 5-10 per cent in 2011-12 from 11.16 million hectares in 2010-11. The rise is attributed to more farmers opting for the crop in the wake of record prices witnessed during the current cotton year (October to September).
This could be gauged from the fact that area under cotton in North India (Punjab, Rajasthan and Haryana) for 2011-12 has witnessed a rise of 15-20 per cent so far. Sowing in these States is almost complete.
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