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Cotton Corp cuts price by 300 rupees more to 36,300 rupees/candy

Monday, Jun 29, 2020

 

The Cotton Corp of India has lowered its reserve sale price of the fibre by 300 rupees a candy (1 candy = 355 kg) following a decline in spot prices. This is the second time that the agency, which has procured a huge stock of cotton this year, has undertaken a price cut this month. "…we have further revised our price for 30-mm variety to 36,300 rupees per candy from 36,500-36,600 earlier," Chairman and Managing Director Pradeep Agarwal said.Earlier this month, the agency had slashed prices from 46,500 rupees. Following the second cut, the current price is 22% lower from 46,500 rupees per candy. Further, the state-owned agency said it will allow discounts on bulk purchases of cotton bales procured in 2018-20 (Oct-Sep) marketing years.

 

Currently, cotton is being sold at 33,500-34,000 rupees per candy in spot markets of Gujarat and Maharashtra.In the 2019-20 (Oct-Sep) season, the agency has procured over 10.0 mln bales (1 bale = 170 kg) of the fibre. Last season, it had bought only 900,000 bales as spot prices of the fibre were mostly higher than its support prices. Cotton Corp is the government's nodal agency for procurement under the minimum support price scheme.Though the price cut by Cotton Corp has made the fibre attractive for the industry, buying is likely to remain subdued due to ample stock in the market. Slowdown in business activity in wake of the COVID-19 pandemic has led to a fall in consumption, said market experts."Definitely, the price offered by Cotton Corp is attractive also the quality is good. However, buying of cotton from CCI will remain weak due to liquidity crisis," said K. Selvaraju, secretary general, Southern India Mills Association.Mills are running at only 30-40% of their capacity and have sufficient stock for the next two months, said Selvaraju.Market experts see closing stock of cotton for the 2019-20 season at around 5.0 mln bales, higher from 2.4 mln bales in the previous year. 

 

Source: http://www.cogencis.com/news

 

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