news
Cotton sowing picks up slowly despite monsoon reviving, but is far below last year
YarnsandFibers News Bureau 2014-07-31 14:52:00 – MumbaiCotton area down
Cotton sowing was slow to pick up over the past three weeks despite South West monsoon rains regaining strength over India. Area under cotton which was around 35.86 lakh hectares in the first week of July, expanded to just 56 lakh hectare by the end of third week of the month. This was half the area covered until same week a year ago and 36.25 lakh lower than normal area sown as of date. Usually about 109.60 lakh hectares is sown under cotton in the entire kharif season. The story is no good for any other kharif crops.
Rains evade many parts
The progress of the monsoon this year has been anything but reassuring. Currently, the situation of the monsoon is similar to that of 2009 and 2012. The only difference between the two years was that the former was termed drought, while the latter eventually ended well with the monsoon picking up spectacularly in the remaining weeks.
This year with another six weeks to go, the uncertainty of precipitation is gradually raising fears of the worst drought. But are we looking at a drought or a sub-par monsoon this year is a million dollar question, not easy to answer.
According to the data released by the India Meteorological Department on 26 July, nearly two-thirds of the country had cumulatively received deficient rainfall (receiving minus 20 per cent to minus 59 per cent below normal). About 1 per cent of the country was classified as having received scanty rainfall (minus 60 per cent to minus 90 per cent). Overall, the cumulative deficit of rainfall for the entire country was 25 per cent between 1 June and 23 July, 2014. It was over 40 per cent a few weeks ago, indicating that there is a pickup in the monsoon over the couple of weeks.
The situation in 2012 was somewhat similar at the same point of time. As of 28 July 2012, about 46 per cent of India had received deficient rainfall, slightly better than this year, and 12 per cent received scanty rains, substantially worse than today.
Cotton harvest estimated down 18 per cent
Cotton production is slated to decline in 2014-15 estimated at 30 million bales of 170 kg each. Both the ministry of textiles as well as the ministry of agriculture estimated the output to fall during the crop year based on the area covered under the cash crop. This would a 17 per cent decline from last year's production of 36.5 million bales as per the third advance estimate released on 24 May by the ministry of agriculture. However, the supplies will remain comfortable next season due to carry over of stock of previous years.
The Cotton Advisory Board under the ministry of textiles has predicted the output at 39 million bales for 2014-15, about 2.50 million bales more than in 2013-14. As the monsoon revived over the past few weeks, sowing of cotton intensified but is was still 44 per cent lower at 5.6 million hectares as on 18 July, compared with 10 million hectares as on the corresponding date last year. Sowing generally begin in the second fortnight of March and ends with the onset of heavy rains by June-end. This year sowing was delayed by a month due to a delay in the commencement of monsoon rains.
The likely fall in cotton output will support cotton prices. The government has announced only a Rs 50 per quintal hike in minimum support price (MSP) for cotton for the 2014-15 marketing season. While the MSP for medium staple length cotton is pegged at Rs3,750 per quintal, that for long staple is fixed at Rs4,000 per quintal. At these levels, MSP is more than double of those in 2007-08 marketing year.
The fall will also corroborate the likely fall in demand from the domestic textile industry and China, the largest export destination. Cotton yarn exports to China has been rapidly declining in recent months and given the change in cotton policy of the Chinese government from 1 August, the demand/supply scenario will under a dramatic change in China, which India cotton farmers and yarn makers will have to watch closely.
Login
Please login to comment
0 Comments
related news
Market Intelligence
Ask for free sample Report
why us?
21
yrs
experience
Fortune 500
Customer Base
100%
dedicated team
55+
Countries Served Worldwide
newsletter
Register below to receive our newsletters with latest industry trends and news!
