Multinational Traders in India Offload Cotton Stocks Amid Global Price Decline and Weakening Demand

Global Traders in India Dispose of Cotton Stocks Due to weak Demand and Global Price Decline

Multinational traders in India are selling off their cotton stocks amidst a global decline in prices due to weak demand and expectations of improved crops in countries like Australia. The May cotton futures contract on ICE, which peaked at 103.80 cents on February 28, has since dropped to 85.89 cents by April 10. This represents a decrease of around 17-18 percent, with domestic prices also down by 8-9 percent from recent highs.

Ramanuj Das Boob, a sourcing agent and vice president of the All India Cotton Brokers Association, notes that multinational companies such as Viterra, COFCO International, and Louis Dreyfus Company are among those selling cotton, with prices ranging from ₹60,000 to ₹62,000 per candy, about 3 percent lower than a month earlier.

Despite ample stocks held by entities like the Cotton Corporation of India, ginners, and traders, market arrivals of raw cotton have slowed in states like Maharashtra and Gujarat. Daily arrivals across various states stand at around 50,000-60,000 bales, with Maharashtra seeing 25,000 bales, Gujarat around 20,000 bales, and Karnataka around 3,000 bales.

Pradeep Jain, President of the Khandesh Gin Press Factory Owners Association, notes negligible arrivals and poor demand, suggesting that farmers may be holding back stocks anticipating better prices. Meanwhile, Boob mentions that North Indian cotton mills have secured their needs for the next six months, purchasing cautiously due to sluggish demand for yarn.

Read More :> Key Projections and Trends for India's Cotton Industry in 2024-25

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