India’s cotton exports in 2012-13 is expected to fall to 7 million bales compared to 12.8 million bales last year following sharp fall in Chinese demand, according to the Cotton Advisory Board headed by the textile commissioner.
Around 65% of India's cotton exports is shipped to China and thus this year due to lack of demand from China.
"China's imports will be lower as their crop is good as well as they have huge stock piles with them," said A B Joshi, Textile Commissioner said.
India's cotton prices are higher compared to international prices due to this India is losing its export market to US, as international prices as lower.
“Although, China is expected to reduce importing cotton from India, they may start importing cotton yarn from India this year,” said Umang Kapasi, joint managing director of Comibatore-based Shri Vardhaman Cotton Corporation, which also operates as an indenting agent.
CAB has estimated this year's (cotton year starts in October and ends in September) total cotton production in India is to be at 33.4 million bales compared to 35.3 million bales last year.
This cotton year- 2012-13 production is lower due to scanty rainfall in major crop growing areas of Gujarat. The Saurashtra has been impacted the most.
However, cotton production in Andhra Pradesh is expected to be around 7.2 million bales compared to 5.6 million bales last year, this has compensated for the loss in Gujarat.
Consumption of cotton by mills and non-mill consumption is expected to be higher this year compared to last year. (see table)
“Mill consumption is higher this year due to rise in productivity of smaller mills as this year they are in a financially better situation compared to last year, also the order in flow is much better this year compared to last year,” said D K Nair, secretary general of Confederation of Indian Textile Industry.
Last year, many mills had financial issues which led to them taking in lower orders as they could not fulfill them.
