The Prices of Cotton in Indian Market Are Likely to Rise in The Coming Months

The prices of cotton in Indian market are likely to rise in the coming months, predicts the latest weekly analysis of cotton market released by S. Ajay Kumar & Company.

According to the report, the arrival of cotton in the Indian market would gradually decrease in the coming days and would come closer to daily consumption by later part of April 2014.

At present, cotton balance sheet is tight as export has been good and there has been high consumption in domestic market. As ginneries close from May onwards, a situation of artificial shortage would be created, the report says.

Throughout off-season, cotton from West Africa will compete with Indian cotton, and Indian consumers might also prefer to buy West African cotton if price turns favourable.

Moreover, it says currently it is the right time for Indian consumers to build cotton inventory, as except for Gujarat, huge quantity of arrival is not expected from other parts of the country.

In the coming months, Chinese firms are also expected to buy Indian cotton after getting import quota.

Hence, overall, the prices of Indian cotton are likely to increase in the coming months, the report concludes.