India''s cotton exports rise due to surge in Chinese demand
India’s cotton
exports may touch 7 million bales this marketing year, a rise of 27 per
cent over the earlier estimate due to a surge in demand, mainly from
China, as Indian cotton is selling at discount, says the Cotton
Association of India (CAI). Inquiries started pouring in from the day
the news of US taxes on China came, said CAI president Atul Ganatra.
The
cotton marketing year started on October 1 Last year. Ganatra said the
earlier target was to export 55 lakh bales of cotton, but India had
already exported that much till March end.
In
the last few days, traders have exported more than 1.5 lakh bales of
cotton to China, according to Indian media reports. Traders said there
is demand for all qualities of cotton with Indian cotton selling at
discounts of 7-10 cents per pound.
China
has almost exhausted its cotton inventory and will be in the market to
import the fibre. India has a good chance, especially with the new duty
on imports from the United States, said Ganatra.
Experts say
India is expected to replace Australia as the second largest exporter of
cotton after China by the end of the 2017-18 cotton season.
Among
other major exporters, US cotton is sold out along with concerns about
its production as Texas zone is facing drought like conditions. Pakistan
is now buying cotton.
Exporters
believe if the increase in the minimum support price (MSP) to be
announced by the Indian Government for 2018-19 is substantial, it could
adversely affect exports. Ganatra, however, feels MSP increase will not
affect trade in any way.
India
has had a bad reputation as Indian traders export inferior quality
cotton, delay shipments, give false packaging, add moisture and cotton
has some trash, industry insiders said. (DS)
Source: The Economic Times, India Saturday, 14 April 2018