Recently, India’s Ministry of Agriculture and Farmers’ Welfare released a forecast: Although the planting area in the main producing area of Gujarat dropped by 5.8% and the weather was dry (accounting for about one-third of India’s annual cotton production), this year’s cotton production will still be It was 36.22 million bales (about 6.157 million tons), an increase of 2.4% over last year.
Fitch Solutions survey results show that India’s cotton production in 2021-22 will decrease by 1% year-on-year to 28.3 million bales (approximately 6.1616 million tons), which is consistent with Indian agriculture. It is highly consistent with the forecast data of the Ministry of Farmers Welfare; the latest USDA report shows that India’s total cotton production in 2021/22 is 6.205 million tons, which is only 40,000-50,000 tons different from the estimates released by Fitch and the Indian Ministry of Agriculture and Farmers Welfare. The expectation of “reduction in cotton planting but increase in income” in India this year continues to increase.
As seed cotton in the northern cotton region of India takes the lead in harvesting and listing, the price of cotton in India has skyrocketed compared with 2019/20 and 2020/21, and farmers’ appetite is increasing. In large areas, only a small number of cotton processing enterprises in Punjab, Haryana, Rajasthan and other places have opened scales, leaving most cotton enterprises in a dilemma.
According to the Punjab State Board, as of September 21, 2021, Punjab has purchased approximately 80,000 quintals of cotton crop at a purchase price of up to Rs 7,010/quintal, which is higher than this year The MSP purchase price is more than 1,200 rupees/quintal; while the price of long-staple cotton DCH-32 in Karnataka, India reaches 11,000 rupees/quintal to 13,000 rupees/quintal (only 5,500-6,500 rupees/quintal in 2020/21) , about 1 times higher than the MSP purchase price.
Several cotton companies in Gujarat and Punjab said that the purchase price in 2021/22 has increased so sharply that not only is it difficult for CCI purchase to start, but some private processing companies have also adopted measures to delay the opening of scales and increase production capacity. Use methods such as water deductions and miscellaneous clothing deductions to avoid risks as much as possible. As for the reasons for the skyrocketing selling price of Indian seed cotton, cotton companies generally attribute to the overall surge in global commodities in 2021, the significant increase in farmers’ investment during the epidemic, and the Indian government still imposes a 10% tariff on imported cotton (U.S. cotton, Brazilian cotton, The cost of West African cotton entering the Indian domestic market has increased significantly, and its competitiveness has weakened). Since June, India has pressed the “restart button” of the textile and apparel industry due to illness, and cotton consumption has recovered rapidly. </p
