 "New cotton arrivals might pull prices further down")
Although fresh cotton arrivals and piling inventory in domestic yarn mills have put pressure on cotton prices in the past few weeks, buyers are waiting for a further fall in prices to pick up quality stuff. The demand for current cotton arrivals in the market remains subdued.
In September, cotton prices declined by Rs 2,000 to Rs 33,500 per candy of 356 kg from Rs 35,500 a candy. It might go below Rs 32,000 a candy over the next month, say experts.
According to traders, new cotton has started to arrive in Gujarat, Maharashtra, Punjab and South-Indian states. An estimated 15,000-20,000 bales (one bale is 170 kg) arrive every day. Traders expect the supply to reach its peak by mid-October, with the bulk of it being good quality cotton.
Dhiren Sheth, president of Cotton Association of India (CAI), said, "The arrival of new crop has started and will gradually increase in the coming days, which will continue to put pressure on the prices. Season's peak supply will be from December onwards."
CAI has released its second estimate for the cotton season 2015-16 beginning on Thursday. It lowered its estimate and placed it at 37.70 million bales. The projected balance sheet drawn by the CAI estimated total cotton supply for the new season at 46.76 million bales, while the domestic consumption is estimated at 32.50 million bales, thus leaving a surplus of 14.26 million bales.
However, the trading community feels the cotton production will not be more than 35 million bales and total supply including carry forward will be about 40.04 million bales. Traders estimated about four million bales opening stock, while according to CAI estimate, the opening stock in new season will be 7.86 million bales.
"We are not seeing fresh demand at least for the next one month, as buyers are waiting for quality product and some more fall in prices. For exports to start, it will take some more time. Arrival of fresh cotton will peak after navaratri festivals," said Mahesh Sharda, president of Northern Indian Cotton Association.
Arvind Pan, managing director of Jaydeep Cotton Fibres Private Ltd, said, "Quality of the new cotton is not good at this time. After quality product starts coming in the market, the demand would increase."
On the price front, traders believe cotton price will decrease further.
Arunbhai Dalal of Arunkumar and Company from Ahmedabad, said, "Arrival will gradually increase and by the end of October it will be around 50,000 bales per day. Though, price will not decrease much from the current level as it is already at rock-bottom. Cotton prices might decrease by Rs 1,000 to Rs 32,000 during October."
In September, cotton prices declined by Rs 2,000 to Rs 33,500 per candy of 356 kg from Rs 35,500 a candy. It might go below Rs 32,000 a candy over the next month, say experts.
According to traders, new cotton has started to arrive in Gujarat, Maharashtra, Punjab and South-Indian states. An estimated 15,000-20,000 bales (one bale is 170 kg) arrive every day. Traders expect the supply to reach its peak by mid-October, with the bulk of it being good quality cotton.
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Dhiren Sheth, president of Cotton Association of India (CAI), said, "The arrival of new crop has started and will gradually increase in the coming days, which will continue to put pressure on the prices. Season's peak supply will be from December onwards."
CAI has released its second estimate for the cotton season 2015-16 beginning on Thursday. It lowered its estimate and placed it at 37.70 million bales. The projected balance sheet drawn by the CAI estimated total cotton supply for the new season at 46.76 million bales, while the domestic consumption is estimated at 32.50 million bales, thus leaving a surplus of 14.26 million bales.
However, the trading community feels the cotton production will not be more than 35 million bales and total supply including carry forward will be about 40.04 million bales. Traders estimated about four million bales opening stock, while according to CAI estimate, the opening stock in new season will be 7.86 million bales.
"We are not seeing fresh demand at least for the next one month, as buyers are waiting for quality product and some more fall in prices. For exports to start, it will take some more time. Arrival of fresh cotton will peak after navaratri festivals," said Mahesh Sharda, president of Northern Indian Cotton Association.
Arvind Pan, managing director of Jaydeep Cotton Fibres Private Ltd, said, "Quality of the new cotton is not good at this time. After quality product starts coming in the market, the demand would increase."
On the price front, traders believe cotton price will decrease further.
Arunbhai Dalal of Arunkumar and Company from Ahmedabad, said, "Arrival will gradually increase and by the end of October it will be around 50,000 bales per day. Though, price will not decrease much from the current level as it is already at rock-bottom. Cotton prices might decrease by Rs 1,000 to Rs 32,000 during October."