India may import around eight lakh bales of raw cotton by end of the crop season that ends in October due to the recent government decision to scrap the 14% duty on cotton imports. The government has also withdrawn the 1%incentive on export of cotton.
Though major imports are expected from Pakistan and Bangladesh over the next two months period, there is a shortage of quality cotton in the country. ?Imports deals to the tune of 8 lakh bales have so far been contracted at rates ranging 74-78 cents per pound till September-end shipments,? a leading importer said.
Thanks to delayed rainfall in the cotton-growing states at start of the season, the new season may be delayed by a month and fresh inflows in Punjab will start only by mid-September, while new arrivals in Gujarat are expected in early October. To sum up, the on-hand-stocks with traders are believed to be limited, sources said.
Shankar-6 prices ruled low around Rs 26,500- Rs 27,300 per candy and the forward price for the December delivery rule at around Rs 24,600-Rs 25,000 a candy. On the other hand, cotton lint prices have tumbled sharply by Rs 200-Rs 300 per candy as exporters resorted to heavy re-selling in the market. ?Rainfall in cotton-growing areas has eased worries over the standing crop and this effected spot prices,? a local trader said. Business failed to rise as most mills and spinners are adopting a wait-and-watch policy.