If import duty is not removed, it will be difficult to run spinning mill after June: CAI President
In its recently released report, CAI has once again reduced the estimate of cotton crop to 313 lakh bales. Important excerpts of CAI Chairman Atul Ganatraji's interview with a channel on reduction in crop estimate and current condition of cotton industry-
Question- Is the reason for the reduction in cotton crop by CAI is the low yield of cotton? Are cotton yields a cause for concern?
Answer- In yesterday's meeting, about 25 members from all the 10 cotton producing states participated in this meeting. The idea was that definitely the yield is the main factor in the reduction in the size of the crop. Since last 5 years our production and yield is going down. Also this year, another important factor is that 90% farmers are already in cotton. Have uprooted the plants and are not doing 3rd and 4th picking as the rate of cotton is very less at 7000-8000 as compared to last year's 12000-15000. This top picking (forward) cotton comes to around 3 million bales. And this 30 lakh bales will not be available this year also this reduction in our yield is a matter of concern for the entire textile industry.
Question- Why is our cotton production falling?
Answer- Our seed technology is very old, we have not changed the seed since 2003. Countries like America, Brazil and Australia are using new technology, so their yield is double than ours. We have recommended the government to change the technology otherwise our spinning industries will suffer. Our cotton consumption is increasing and in the last 15 months 2 million new spindles have been added in India. And in coming 7 months 8-10 lakh new spindles will be erected so our Indian consumption is very high and our production is decreasing year by year so it is very important to bring new seeds and new technology. Till now we could survive even with less crop as we had opening stock of cotton from 125 lakh bales and 75 lakh bales from 2020 (due to corona) but now our opening stock is negligible.
Question- How is the situation of arrival and how much cotton is with the farmers?
Answer- Till February 20, 1,55,000 bales have arrived in India. According to our crop, 313 lakh bales means, 50% has arrived and 50% is in the hands of the farmers. In North India 20-25% crop, in Central India 40-50% crop, in South India 30-40% crop is in the hands of farmers.
Question- If farmers do not sell cotton, it will be carried forward to the next year, then in the CAI meeting next month, there will be further reduction in crop numbers?
Ans- Actually it is very difficult to understand the mind of farmers last year farmers saw rate of cotton 12000 to 15,000 per quintal and this year the prices are very low at 7-7500 so big farmers can move their whole cotton higher Farmers can carry forward a minimum of 15 lakh bales for the next season and a maximum of 25 lakh bales for the next season for rate expectation. If this happens, there is a possibility of further reduction in the number (harvest) of CAI in the coming months. We are advising Indian mills to buy cotton.
Question- How is the demand for spinning mills?
Answer- Spinning mills are running at 95% average capacity in India and monthly consumption is at peak. The monthly consumption of cotton is 28-30 lakh bales. The demand from Indian mills is very good, mills are buying 1-1.10 lakh bales for daily consumption. cotton export is 10-15,000 per day now indian mills have no problem getting cotton but in month of april but in april when arrival will reduce then it may be difficult for spinning mills to cover cotton Lets do it. Since our consumption is high and production is low, the government should remove 11 per cent import duty on cotton. Indian spinning mills will have a tough time after June-July if the import duty is not removed. And we will see the repeat of last season 2022.
