The impact of slowdown of major economies has affected the textile industry and consumption of cotton in major textile producing countries has been adversely affected.
The mills are finding it difficult to dispose off the yarn/fabric due to reduced purchases by the consumers. The cotton prices both at the domestic level as well as at international level are still under pressure.
Due to increased pressure of arrivals in almost all the cotton growing states and lesser purchases by private ginners/traders, the purchase of Cotton Corporation of India (CCI) at minimum support price (MSP) in all the states have increased. The CCI has so far bought about 15 lakh bales in Punjab, Maharashtra, Madhya Pradesh, Andhra Pradesh and Karnataka, while its purchases are much lesser in Gujarat, Haryana and Rajasthan as kapas prices in these states are still ruling above the MSP level. The government recently raised it by 40% in 2008 to Rs 570 per 20 kg, trade sources said. Nearly 4,000 ginners across the country have observed the two-day strike, starting from Tuesday. However, there is no major impact of ginners? strike on the prices front, trade sources said.
“We have been seeking a bailout package from the government. We have asked for 8% incentive from the government, including DEPB benefits for export and subsidy for domestic players,” Saurin Parikh, general secretary, Gujarat Ginners Association (GGA) told FE.
Prices of Shankar-4 in Gujarat were ruling around Rs 21,500 per candy. “Prices may remain steady to weak in the coming weeks as the tempo of kapas arrivals will increase further and may reach over 2 lakh bales in first week of December,” CCI official said.
The daily kapas arrivals have picked up to 1.90 lakh bales in all the states. The total arrivals also reported at 47.85 lakh bales as on November 22, 2008 as against 61.95 lakh bales, down by 23%.
The total arrivals are reported to be around 7.8 lakh bales in Punjab, 4.85 lakh bales in Haryana and about 1.85 lakh bales in Rajasthan.
In the Central zone, the arrivals have picked up further with daily arrivals reported to be around 10.90 lakh bales in Gujarat, 7.45 lakh bales in Maharashtra & 4.70 lakh bales Madhya Pradesh. The daily arrivals in South zone are reported to be around bales out of which 7.8 lakh bales are reported to be arriving in Andhra Pradesh and 1.50 lakh bales in Karnataka.
