Cotton prices fall as WASDE forecasts higher production and ending stocks for 2024/25 crop year
By DHEERAJ GUPTA 2025-01-21 13:01:27
As WASDE projects increased production and ending stocks for the 2024–2025 crop year, cotton prices decline.
Cotton candy prices fell 0.45% to close at ₹53,670 on bearish sentiment following a WASDE report that forecast higher production and ending stocks for the 2024/25 crop year. Global cotton production is estimated to rise by 1.2 million bales to 117.4 million due to large crops in India and Argentina. However, north Indian states reported a sharp 43% drop in cotton arrivals till November 30, leading to a shortage of raw material for ginners and spinners. The Cotton Association of India (CAI) estimates cotton consumption for 2024/25 at 313 lakh bales, while the pressing estimate remains unchanged at 302.25 lakh bales.
Cotton imports are expected to rise by 9.8 lakh bales to 25 lakh bales compared to last year. Nearly 9 lakh bales had arrived at Indian ports till November 30. Ending stocks for 2024/25 are estimated at 26.44 lakh bales, down from 30.19 lakh bales in the previous year. Globally, US cotton production forecast rose to 14.3 million bales in December, while world production rose to 117.4 million bales. World consumption rose by 570,000 bales, led by India, Pakistan and Vietnam, offsetting a shortfall in China. Meanwhile, exports are slightly higher, with notable growth in Brazil, Benin and Cameroon.
Technically, the market is witnessing long liquidation as open interest fell 19.29% to 297. Prices are supported at ₹53,490, with potential downside to ₹53,300. Resistance is seen at ₹53,940, and break above this level could test ₹54,200.
