AT harvest higher estimates of consumption and tight supply is to keep cotton prices firm for the next few weeks, even as farmers continue to hold close to 40 per cent of the total crop of 34 lakh bales, according to Acharya NG Ranga Agricutural University (ANGRAU) Market Intelligence Centre Kharif pre-sowing projections for 2017-18.
Kapas prices have remained firm in the range of Rs.5, 900 -6000 per quintal, over the past few weeks due to lower than expected arrivals of crop and higher estimates of consumption. According to trade sources, so far about 208-210 lakh bales or about 61 per cent of the total crop has arrived.
On consumption front, the Cotton Association of India has estimated for the ongoing year (October to September 2016-17) at 295 lakh bales higher than last year’s 290 lakh bales. Prices are likely to remain firm in near future as demand from yarn makers, millers, and export is likely to be higher this year.
Currently cotton mills and ginners from Gujarat, Maharashtra, Andhra Pradesh, Punjab and Karnataka have been purchasing cotton. According to the trade sources cotton prices would remain firm as crop output is likely to be less in Pakistan, Bangladesh and China.
Given this State of affairs, and assuming normal area in kharif 2017-18, an attempt is made to forecast the prices of cotton at harvest period. Towards this end, the modal prices of Warangal were made use of. The results of the analysis in addition to the market survey indicated that the price per quintal would be around Rs. 4600 to Rs. 5000 at harvest.