Domestic cotton prices likely to ease in coming months

Cotton prices in futures market have been trending down since last month. They are still on the higher side at Rs 19,650 per bale. The prices are 25 pc higher as compared to last year for the same period. “Factors which will decide cotton prices in coming months are exports and domestic mill demand for Indian cotton,” Angel Broking Agri Commodities Analyst Ritesh Kumar Sahu said. “As per the Cotton Association of India (CAI), the cotton supply in the domestic market will be sufficient as the export and consumption will be lower during the current cotton season,” he said. Cotton harvest has also started and new Kapas has arrived in the market. It will still be time before peak arrivals start during December and January, due to late harvest expected in Gujarat and Maharashtra. Total availability of cotton in India is pegged at 398 lakh bales versus estimated consumption of 309 lakh bales.  The export will decline by 40 per cent in 2016-17 to 849,000 tons compared to 12.55 lakh tonnes last year. MCX-Cotton and NCDEX-Kapas future prices fell 2.7 per cent and 4.13 per cent in last one month on lower demand from the industrial users like ginners, cotton mills and textile units. Due to prospects of higher crop production in the country, the prices of cotton have been falling during the last 2 months of August and September of the cotton season.