1 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6
(As on 13.05.2016)
Commodity Profile for Cotton- May, 2016
Contents
1. Cotton Estimates for India ... 2
2. Cotton Estimates for World ... 2
3. Domestic Production ... 3
4. Global Production ... 3
5. Major Exporting and Importing Countries of Cotton in the World ... 4
5.1 Major Exporting Countries in the World ... 4
5.2 Major importing Countries in the World ... 4
6. India’s Major Export Destinations ... 5
7. India’s Trade Flow during 2009-10 to 2014-15 ... 5
8. Domestic Prices Movement ... 6
8.1 Price Movement for Raw Cotton (Kapas) ... 6
8.2 Price Movement for Cotton (Lint) ... 6
9. Movement of Domestic as well as International prices of Cotton ... 7
10. Minimum Support Price (MSP) for Cotton during 2009-10 to 2014-15 ... 7
11. Future prices ... 8
12. Price Movement in Major Domestic Mandis ... 8
13. Cotton Arrivals in Major Domestic Mandis... 9
14. Trade Policy ... 9
14.1 Export policy ... 9
14.2 Import Policy ... 9
2 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6
1. Cotton Estimates for India (Crop Year: October 2015 to September 2016)
(Unit:Lakh Bales) Table 1: Cotton Stock, Crop Size, Trade, and Consumption
2014-15 2015-16
(Estimated) Particular March, 2016 Source
Supply
40.2 36.40 Opening stock - Textile Commissioner
348.05 349.76 Crop Size 305.24# DAC
15.27 12.8 Total Imports 4.45** DoC
403.52 398.96 Total Availability 309.69
Demand
241.8 249.98 Mill Consumption Textile Commissioner
23.3 23.44 Small-Mill Consumption Textile Commissioner
8.3 11.1 Non-Mill Consumption Textile Commissioner
273.4 284.52 Total Consumption Textile Commissioner
67.20 99.97 Total Exports 60.49** DoC
Sources: Department of Agriculture and Cooperation (DAC),Department of Commerce (DoC), Textile Commissioner.
# As per 3rd Advance Estimates for 2015-16, DES of 09.05.2016
For preparing estimated figure for 2015-16, Opening Stock, Mill Consumption, Small Mill Consumption, Non-mill Consumption, Exports, and Imports have been taken for last three years’ average.
**Export and import is for October- March, 2015-16.
2. Cotton Estimates for World
(Unit: lakh Bales) Table2: Global Cotton Stocks, Production, Consumption & Export
Year Beginning August 1
2012-13 2013-14 2014-15 2015-16*
Beginning stock 859 1158 1311 1421
Cotton Production 1582 1542 1528 1425
Cotton Consumption 1377 1396 1427 1477
Cotton Exports 597 512 433 431
Ending stocks 1158 1311 1421 1361
Source: USDA *: Estimated Figure
During 2012-13and 2014-15, the world production has decreased by 3percent (from 1,582 Lakh Bales to 1,528 Lakh Bales), export by 27% (from 597Lakh Bales to 433Lakh Bales). However consumption has increased by 3.6 percent (from 1,377Lakh Bales to 1,427 Lakh Bales).
Estimated figure for consumption has increased whereas, production and export has decreased in 2014-15. This is due to excess stock accumulated during the last two years.
Based on USDA database the world export may decline by around 2 lakh bales in 2015-16 over the exported value registered in 2014-15. Fall in the import demand from China and excess stocks in the markets are the contributing factors in the decline of total exports during 2014-15.
3 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 3. Domestic Production
Source: DES, Agriculture, Cooperation& Farmers Welfare 1 Bale=170 Kgs
The projected figure for domestic production in 2015-16 is less than that of the previous year.
4. Global Production
Source: United State Department of Agriculture (USDA). *: Advance estimation by USDA
India and China were the top two global producers of cotton in 2015-16 followed by USA.
0 50 100 150 200 250 300 350 400
2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
Qty in Lacs Bales
Figure 1: Domestic Cotton Production
Production (Lakh Bales)
0 50 100 150 200 250 300 350 400 450
India China USA Pakistan Brazil
Uzbekistan
Turkey Other
lakh bales
Figure 2: Global Production
2013-14 2014-15 2015-16*
4 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6
5. Major Exporting and Importing Countries of Cotton in the World 5.1 Major Exporting Countries in the World
Source: Comtrade
USA was the major exporting country in the world followed by India and Australia in 2014.
5.2 Major importing Countries in the World
Source: Comtrade
China was the largest importing country in the world followed by Turkey and Indonesia in 2014.
0 20 40 60 80 100 120 140 160 180
Lakh Bales
Figure 3: Major Exporting Countries
2012 2013 2014
0 50 100 150 200 250 300 350
Lakh Bales
Figure 4: Major Importing Countries
2012 2013 2014
5 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 6. India’s Major Export Destinations
Source: Department of Commerce
India’s major Export destinations in 2015-16 were Bangladesh, Pakistan and China.
Countries such as Bangladesh, Vietnam, Pakistan and Taiwan are scaling up their cotton imports from India to meet the requirements of their export-focused garment industries.
China’s restrictive import policy and its accumulated stock have adversely impacted India’s export to that country in 2015-16.
7. India’s Trade Flow during2009-10 to 2015-16
Table 3: Trade Flow for India
Year Lakh Tonnes Lakh Bales
Export Import Export Import
2010-11 12.58 0.56 74.00 3.29
2011-12 20.13 0.78 118.41 4.59
2012-13 20.15 2.16 118.53 12.71
2013-14 19.41 1.78 114.18 10.47
2014-15 11.43 2.58 67.20 15.22
2015-16 13.46 2.32 79.17 3.64
Source: Department of Commerce
India exported substantial quantity of cotton during 2011-12 to 2013-14.
0 1000 2000 3000 4000 5000
Value in Rs Crore
Figure 5: India's Major Export Destination
2014-15 2015-16
6 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 8. Domestic Prices Movement
8.1 Price Movement for Raw Cotton (Kapas)at major Centers during October, 2015 and April, 2016
Source: Textile Commissioner
Prices for raw cotton (Kapas) in major markets are showing a mixed trend.
8.2 Price Movement for Cotton Lint at major centers during October, 2015 and April, 2016
Source: Textile Commissioner 3500
3700 3900 4100 4300 4500 4700 4900 5100 5300 5500
10-Oct-15 10-Nov-15 10-Dec-15 10-Jan-16 10-Feb-16 10-Mar-16 10-Apr-16
Rs./Quintal
Figure 6: Kapas Price Trend at Key Centers
Rajkot (BT) Ahmedabad (S-6) Amravati (Mech-1) Hisar (BT)
3000 3100 3200 3300 3400 3500 3600 3700 3800 3900 4000
12-Oct-15 17-Oct-15 24-Oct-15 30-Oct-15 5-Nov-15 12-Nov-15 18-Nov-15 24-Nov-15 30-Nov-15 5-Dec-15 11-Dec-15 17-Dec-15 23-Dec-15 30-Dec-15 7-Jan-16 13-Jan-16 19-Jan-16 25-Jan-16 1-Feb-16 6-Feb-16 12-Feb-16 18-Feb-16 24-Feb-16 1-Mar-16 7-Mar-16 12-Mar-16 18-Mar-16 25-Mar-16 31-Mar-16 6-Apr-16 12-Apr-16 19-Apr-16 25-Apr-16 30-Apr-16
Rs./ Maund (of 37.32 kg each) Figure 7: Lint Price Trend at Key Centers
Bhatinda Sirsa Abohar
7 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6
9 Movement of Domestic as well as International Prices of Cotton
Source: International Price –cotlook.com, Domestic Price- Textile commissioner
Domestic Prices have been lower than International price since October, 2014.
10 Minimum Support Price (MSP) for Cotton during 2011-12to 2015-16
(Unit: Rupees/Quintal ) Table 4: Minimum Support Price for Cotton
Staple Size 2011-12 2012-13 2013-14 2014-15 2015-16
Medium Staple Cotton 2800 3600 3700 3750 3800
Long Staple Cotton 3300 3900 4000 4050 4100
Source: Commission for Agricultural Costs and Prices (CACP)
An increase in the Minimum Support Price (MSP) for both Medium as well as long staple size cotton is recorded. This figure has increased by 35 percent for medium staple and 24 percent for long staple cotton in the last 5 years.
70000 80000 90000 100000 110000 120000 130000 140000
Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16
Rs/Ton
Figure 8: Monthly Domestic and International Price Movement
International prices (Cotlook A Index) Domestic Prices ( Shankar-6)
8 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 11 Future prices
(Unit: Rupees/Bale) Table 5: Future Prices for Cotton
Date of Contract
10 May 2016
10 April 2016 (1 month ago)
10 Feb 2016 (3 months ago)
10 Nov 2015 (6 months ago)
10 May 2015 (year
ago)
% Change
over a month
% Change
over previous
year May 2016 15700.0 15862.7 14740.0 15322.6 15218.0 -1.03 3.17 July 2016 15700.0 15865.3 14884.3 15430.0 15201.8 -1.04 3.28 Oct 2016 15164.7 15925.6 14869.4 15442.2 15178.5 -4.78 -0.09 Dec 2016 15309.1 15686.6 14961.4 15122.4 15176.2 -2.41 0.88
Mar 2017 15167.2 15742.0 15187.9 N.A N.A -3.65 −
May2017 15281.7 15832.5 N.A N.A N.A -3.48 −
Source: Intercontinental Exchange (ICE).
Future prices for cotton are expected to increase over previous year.
12 Price Movement in Major Domestic Mandis
(Unit: Rupees/ Quintal) Table 6: Price Movement in Major Domestic Mandis
Markets April, 2016 March,
2016 April, 2015 % Change (over previous month)
% Change (over previous year)
Rajkot 4579.74 4754 4326.46 -3.67 5.85
Surender Nagar 4341.8 4374.7 4218.21 -0.75 2.93
Amaravati 4689 4649 4510 0.86 3.97
Guntur 4180 4139.17 4006.94 0.99 4.32
Warangal 4348.34 4136.97 4067.27 5.11 6.91
Sirsa 4601.64 4497.24 4407.56 2.32 4.40
Bhatinda 4610.46 4086.28 4328.16 12.83 6.52
Ganganagar 4437.39 4434.67 4006.41 0.06 10.76
Source: Agmarknet
Major domestic Mandis in India experienced an increase in prices in April 2016 over the same period of the previous year (See Table 6).
9 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 13 Cotton Arrivals in Major Domestic Mandis
(Unit:Tonnes) Table 7: Cotton Arrivals in Major Domestic Mandis
Markets April 2016 (cumulative)
March 2016 (cumulative)
April 2015 (cumulative)
% Change (over previous month)
% Change (over previous year)
Rajkot 83696.5 71152.5 49225.1 17.6 70.03
Surender Nagar 36850.7 35954.7 46261.1 2.5 -20.3
Amravati 131213 118355 68519.5 10.9 91.5
Guntur 3937.9 3916.5 8888.2 0.5 -55.7
Warangal 141831.21 125484.1 138664.9 13.0 2.3
Sirsa 67651.4 67261.9 273383.5 0.6 -75.3
Bhatinda 32359.4 31764.4 80959.7 1.9 -60.0
Ganganagar 88709.54 88681.2 132491.3 0.03 -33.0
Source: Agmarknet.
Arrivals in April, 2016 in major domestic mandis like Surender Nagar, Guntur, Sirsa, Bhatinda, and Ganganagar were less over the same period of the last year.
14 Trade Policy 14.1 Export policy
Export of cotton is free without any restrictions.
Table 8: Export Policy Exim
Code
Item Description Policy
5201 Cotton neither carded nor combed Free*
5202 Cotton waste (including yarn waste and garneted stock) Free
5203 Cotton, carded or combed Free*
Source: Directorate General of Foreign Trade (DGFT)
*: The registration requirement for export of cotton (HS Code 5201and 5203) has been dispensed with vide DGFT’s Notification No. 102 (RE-2013)/2009-14, dt: 8.12.2014.
10 | C o m m o d i t y P r o f i l e f o r C o t t o n - M a y , 2 0 1 6 14.2 Import Policy
Import of cotton is duty free without restrictions.
Table 9: Import Policy Exim
Code
Item Description Policy
5201 COTTON NOT CARDED OR
COMBED
Bound Rate
Standard Rate
Applied Rate
5201 00 Cotton, not carded or combed:
Indian cotton: 100% 10% Nil
5201 00 11 Bengal deshi 100% 10% Nil
5201 00 12 Indian cotton of staple lengths 20.5 mm (25/32”) and below (e.g.
oomras, yellow picking, Assam comillas)
100% 10% Nil
5201 00 13 Indian cotton of staple length exceeding 20.5mm (26/32”) but not exceeding 24.5 mm (30/32”)
100% 10% Nil
5201 00 14 Indian cotton of staple length over 24.5mm (31/32”) to 28mm
100% 10% Nil
5201 00 15 Indian cotton of staple length 28.5mm (14/32”) and above but below 34.5mm
100% 10% Nil
5201 00 19 Indian cotton of all staple length 34.5mm and above (112/32”)
100% 10% Nil
5201 00 20 Cotton, other than Indian, of all staple length
100% 10% Nil
5202 COTTON WASTE (INCLUDING
YARN WASTE AND GARNETTED STOCK)
5202 10 00 Yarn waste (including thread waste) 100% 15% Nil
Other:
5202 91 00 Garnetted stock 100% 15% Nil
5202 99 00 Other 100% 15% Nil
5203 COTTON, CARDED OR
COMBED
5203 00 00 Cotton, carded or combed 150% 30% Nil
Source: Directorate General of Foreign Trade (DGFT), WTO and D/o Revenue, CBCE
