Demand for cotton from India, the world’s second-largest producer and exporter, may climb after floods damaged crops in Pakistan, FCStone Group Inc said. “In light of the floods in neighbouring Pakistan, the demand outlook for Indian cotton is increasingly bright,” FCStone, a commodities risk intelligence firm, said in a report dated yesterday.
Floods have destroyed 30 per cent of the crop in Pakistan, the fourth-largest producer, the Kissan Board of Pakistan, a trade group, said this week. Cotton has risen 27 per cent in the past year in New York and the price may trade around current “historically high” levels until at least the US harvest at the end of the year, Olam International Ltd said yesterday.
“According to local sources, the flooding in cotton-producing regions in Pakistan is prompting heavy inquiries from panic-stricken Pakistani traders,” FCStone said. “Indian spot markets are reported to be firm and active, owing to increasing demand from local and international buyers, especially from neighbouring Pakistan.”