The CCI has begun procuring cotton at the minimum support price (MSP) in Andhra Pradesh and Telangana in a small way since the pace of arrivals is slow due to the recent rains.
In Maharashtra, Maharashtra Cotton State Federation, which is affiliated to the National Agricultural Cooperative Marketing Federation of India (Nafed), says it will begin procurement operations from December 1 to December 15 since monsoon in the state was delayed by around one-and-a- half months.
Because of the rains, the moisture content in the Kapas is around 20%. Overall, however, there should be no impact on the cotton output and no loss due to the recent cyclone, BK Mishra, MD, CCI told FE.
In Andhra the cotton rates are on par with the MSP price, Mishra said. He said that CCI has written to the Centre to persuade Nafed, the other agency responsible for procuring cotton, to begin procurement operations at the earliest. Till date, CCI has procured around 30,000 bales and the arrivals are to the tune of 50,000 to 55,000 bales in the market, he added.
The arrivals are expected to go up to 1 lakh bales in December and January.
The Cotton Advisory Board has estimated domestic cotton production at 400 lakh bales this year (October 2014 to September 2015). Though the market prices might not fall further, the CCI might have to buy one crore bales of cotton this year at the MSP, the official said.
The corporation is gearing up to procure the fibre at the minimum support price in Telangana, Karnataka, Maharashtra and Odisha. It will procure cotton in Andhra Pradesh at R4,050 per bale and R3,750 per bale in Punjab.