Multi Commodity Exchange of India (MCX) has received extremely encouraging response with cotton deposits in the current season (October 2017) till date, notably increasing by 294 % in June 2018 as against June 2017. MCX witnessed 57% jump in its cotton contract\u2019s average daily volume from 2,605 lots (1 lot equals 25 bales) in June 2017 to 4,085 lots in June 2018. Correspondingly, there has been a substantial increase in average daily value from Rs 132 crore to Rs 231 crore over the said period. Moreover, the cotton stocks in warehouses hit a five year high at 1,61,000 bales in June 2018. The open interest stood at 13,581 lots at the end of June 2018, the exchange said in a statement. The basis delivery centre for MCX Cotton contract is Rajkot (Gujarat) with additional delivery centres at Yavatmal and Jalna (Maharashtra), Kadi, and Mundra (Gujarat), and Adilabad and Warangal (Telangana), and the deposits are spread all across the delivery centres, it added. India is the largest producer of cotton in the world, accounting for about 27% of the global production. The major cotton producing states are Andhra Pradesh, Maharashtra, Gujarat, Punjab and Haryana. The growth in cotton crop has resulted in greater stability in cotton production. India is the second largest exporter of cotton in the world. This makes cotton prices very vulnerable to changes in global demand and supply. In this regard, MCX cotton futures contract has emerged as a valuable and effective tool for managing cotton price risk. MCX MD & CEO Mrugank Paranjape said MCX cotton futures contract has grown from strength to strength and has proven to be national price benchmark and effective risk management tool for multiple stakeholder groups across the cotton value chain. India\u2019s annual production of cotton has been steadily increasing in the recent years, supported by a rise in acreage, better genetically modified seeds, and improved practices. According to Cotton Advisory Board (CAB), India\u2019s estimated production is 370 lakh bales in 2017\u201318 crop year as compared with 34.5 lakh bales in 2016-17. The acreage yield was 568 kg per hectare in 2016-17 as against 484 kg per hectare in 2015-16. According to CITI, the area under cotton cultivation increased to 122.59 lakh hectare in 2017-18 (up by almost 13%) from 108.45 lakh hectare. India\u2019s cotton consumption is estimated at 316 lakh bales in 2017-18 (including non-mill consumption of 19 lakh bales) against 306 lakh bales in 2016-17. As per Cotton Association of India, India has been a major exporter of cotton since 2005\u201306, and currently, the world\u2019s second largest exporter. It is estimated that India had exported 70 lakh bales of cotton in 2017-18 as compared to 58.2 lakh bales in 2016-17.