Cotton yield in Gujarat may drop on delayed rains

Delay in second spell of rains in Gujarat may impact cotton production in the state by at least 25 per cent, traders said.

India's largest cotton growing state is estimated to produce 10 million bales (1 bale=180 kilogram) from 2.2 million hectares during the current cotton season (June-February), up 15 per cent from last year.

"Delayed rains may affect the crops already sown in 1.9 million hectares of land in the state," Navin Soni, a trader based in Harij, north Gujarat, said.

This time 2.2 million hectares has been put under cotton cultivation in Gujarat, up 300,000 hectares from last year.

The 1.9 million hectares of land has already been sown with Shanker 6 and Kalyan V797 varieties and rest will be covered soon, traders said.

The water-parched region of north Gujarat has sown cotton in 500,000 hectares of land, traders said. Farmers in major cotton producing areas of north Gujarat, Harij, Sami and Patan, have gone for large staple Shanker 6 (28mm) variety of cotton, they said.

"Traders have started holding the old stock due to delay in second spell of rains," Hemal Shah of Manubhai Mangaldas & Co. said.

Since the last one week, spot prices in Ahmedabad are up 2 per cent on account of delay in rains resulting in traders holding back existing cotton stock.

Spot market witnessed a slight rise in cotton prices today due to suppressed sentiment about impact of delayed rains. Markets opened at 18,500 per candy (356 kgs) of long staple Shanker 6 cotton, up 300 rupees. Kalyan V797 opened at 13,300 per candy, up Rs 500.

"If delay in rains persist for another two weeks, it will lead to downfall in cotton production by 20-25 per cent," Khodabhai Patel, a cotton trader from Kadi in Mehsana district said.

Analysts said the current week is crucial for farmers as well as market players as it will determine the quality and quantity of total crop from the state.

"Weather is playing hide and seek and if rains do not come by this weekend it will affect cotton crops in Surendranagar, Rajkot and Bansakantha districts," said Biren Vakil of Paradigm Commodity Advisors.

"Negative sentiments have started surfacing in the market fearing lower cotton production due to delay in rains," Manubhai Shah, director, East India Cotton Association, Mumbai said.

Shah said further delay in rains would strengthen this negative sentiment. He said if the delay in rainfall is stretched then it would immediately lead to a drop of 5 per cent in production.

According to market reports, farmers in Saurasthra region have preferred cotton over groundnut cultivation for high returns, but delay in rains may usher difficult times for them.