Low cotton productivity in Punjab, Haryana and Rajasthan this year has increased the price of cotton, affecting performance of the textile industry.
As the arrival of cotton bales picks up, the price of cotton is hovering around Rs 2,700-2,900 per quintal against the last year’s price of 2,150-2,450 per quintal. Textile industry experts say this will sound a death knell for small textile units in North. Low production will further hit the margins of the textile industry. The Spinning industry will be hard hit and it may lead to a rise in prices of end products, said VK Kapoor, a senior official from Ispat Groups Gonterman Peipers, the largest spinning unit under one roof in this region.
Punjab and Haryana had earmarked 6.50 lakh and 6 lakh hectare for cotton crop respectively, during the start of the season this year. Last year, cotton was grown on 4.83 lakh hectares in Haryana and 5.32 lakh hectares in Punjab. The two states were expecting 25 to 30 % increase in area under cotton production this year.
However, area under cotton actually came down by 14 % in Haryana and 12 % in Punjab. Area of 4.17-lakh hectare was engaged for cotton sowing in Haryana while 4.72 lakh hectares in 4.72 lakh hectares.
Though data from Rajasthan was not available, cotton growers from Bathinda bordering Rajasthan belt said situation was no different in the border belt.
Sunil Jakhar, MLA from Abohar told FE on Thursday that some unfavourable factors like unseasonable rains had resulted in less area under cotton crop this year. Harbhajan Singh Bhajan, a cotton grower from Bathinda told it was like once bitten twice shy.
He said earlier farmers had sown paddy on more area but government announcement of MSP did not come up to the expectations of farmers. This time, they avoided cotton cultivation on more area anticipating similar situation on that front too.
Dr B S Duggal, additional director, agriculture admitted that the reason for the decline in production this year was reduction in the total land under cotton cultivation. As a result, small textile units especially in Punjab and Haryana have reportedly cut down their output by 0.5 to 0.7 % as cotton prices have already increased by 40 %in comparison to last year as arrivals in mandis have picked up these days. Further announcement of hike in cotton’s minimum support price (MSP) by almost 40 % is likely to worsen the scenario for the textile industry.
As a result of low acreage, the actual output of cotton from Punjab and Haryana may fall by 11 %and 4.5 % though Haryana has almost made up for the low acreage in view of higher productivity this year.
Cotton production in Punjab is likely to be around 2.1 million bales this year compared to 2.35 million bales last season. while Haryana is expecting 1.8 million bales this year.