Demand for cotton has dropped in the past few days as mills are finding high prices unviable. Prices of quality cotton remained stable at Rs 61,000-62,000 a candy of 356 kg on lower arrivals.
The Sankar -6 variety was traded at Rs 61,000-62,000 a candy in Gujarat. Lower to medium quality cotton was at Rs 57,000-59,000 a candy. Raw cotton stood at Rs 1,400-1,435 for 20 kg. On the National Commodity and Derivatives Exchange, Kapas Surendranagar April contract decreased Rs 17.50 or 1.43 per cent to Rs 1,204.10 a quintal, with an open interest of 1,797 lots. Around 18,000 bales arrived in Gujarat and 55,000 in the rest of the country.
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According to cotton traders, arrivals are decreasing, especially of quality cotton. So, buyers are procuring according to requirement. Moreover, elections in the southern States has also affected demand.
A Rajkot-based broker said: “Buyers in Gujarat are procuring from Maharashtra as prices there are lower. So prices will not increase in the near future. It will remain between Rs 60,000-62,000 a candy.”
According to market sources, farmers are holding on to their crops hoping the Government will allow more exports of cotton.
Higher prices are unviable for mills since yarn is not moving due to problems faced by the fabric and garment sectors. Exports, too, though permitted from April 1 are yet to begin.