(As on 20.05.2019)
Commodity Profile for Cotton- May, 2019
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
1. Cotton Estimates for India (Crop Year: October 2015 to September 2016)
(Unit: Lakh Bales) Table 1: Cotton Stock, Crop Size, Trade, and Consumption
2016-
17 2017-18 Particular 2018-2019 (P) Source
Supply
36.44 47.81 Opening stock 50.08 Textile Commissioner
325.77 339.15 Crop Size 300.87# DAC
28.29 26.41 Total Imports 5.94** DoC
390.5 413.37 Total Availability 356.89
Demand
262.66 288 Mill Consumption 273.62 Textile Commissioner
26.2 27 Small-Mill Consumption 26.76 Textile Commissioner
17.5 19 Non-Mill Consumption 18.16 Textile Commissioner
306.36 334 Total Consumption 318.54 Textile Commissioner
53.59 58.01 Total Exports 39.02** DoC
Sources: Department of Agriculture and Cooperation (DAC),Department of Commerce (DoC), Textile Commissioner.
# As per 2nd Advance Estimates for 2018-19, DES of 28.02.2019
For preparing estimated figure for 2018-19, Opening Stock, Mill Consumption, Small Mill Consumption, Non-mill Consumption have been taken for last three years’ average.
**Export and Import is for October-March, 2018-19.
2. Cotton Estimates for World
(Unit: lakh Bales) Table2: Global Cotton Stocks, Production, Consumption & Export
Year Beginning August 1 2015-16 2016-17 2017-18 2018-19*
Beginning stock 1369 1157 1030 1038
Cotton Production 1231 1366 1585 1523
Cotton Consumption 1454 1491 1578 1582
Cotton Exports 443 485 524 539
Ending stocks 1157 1030 1038 979
Source: USDA*: Estimated Figure
During 2015-16 and 2017-18, the world production has increased tremendously by 22.3 percent (from 1231Lakh Bales to 1585Lakh Bales), export by 15.39% (from 443 Lakh Bales to 524 Lakh Bales) followed by consumption which has increased by 7.9 percent (from 1454 Lakh Bales to 1578Lakh Bales).
Estimated figure for consumption, production and export has increased in 2017-18. This is due to less stock available during the last two years and higher export demand.
Based on USDA database the world export may increase by around 15 lakh bales in 2018-19 over the exported value registered in 2017-18. Increase in the import demand from China recently of 8
lakh bales and less stocks in the markets are the contributing factors in the increase of total exports during 2018-19
.
3. Domestic Production
2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19*
0 50 100 150 200 250 300 350 400
Figure 1: Domestic Cotton Production
Qty in Lakh Bales
Source: DES, Agriculture, Cooperation& Farmers Welfare 1 Bale=170 Kgs
The projected figure for domestic production in 2018-19 is less than that of the previous year due to unsuitable dry weather conditions in the major producing states this season.
4. Global Production
India China United States Pakistan Brazil Uzbekistan Other 0.00
5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00
Figure 2: Global Production
2016/17 2017-18 2018-19*
Lakh Bales
Source: United State Department of Agriculture (USDA).*: Advance estimation by USDA
China and India were the top two global producers of cotton in 2017-18 followed by USA and same trend is following this year.
5. Major Exporting and Importing Countries of Cotton in the World 5.1 Major Exporting Countries in the World
USA
India
Australia
Brazil
Greece
Burkina Faso
Benin
Côte d'Ivoire
Cameroon
Turkey 0
50 100 150 200 250
Figure 3: Major Exporting Countries
2015 2016 2017
Lakh Bales
Source: Comtrade
USA was the major exporting country in the world followed by India and Brazil in 2017.
5.2 Major importing Countries in the World
Viet Nam
China
Turkey
Indonesia
Pakistan
India
Mexico
Rep. of Korea
Other Asia, nes
Egypt 0
10 20 30 40 50 60 70 80 90 100
Figure 4: Major Importing Countries
2015 2016 2017
Lakh Bales
S ource: Comtrade
Vietnam was the largest importing country in the world followed by China and Turkey in 2017. .
6. India’s Major Export Destinations
BANGLADESH PR
CHINA P RP
PAKISTAN IR
VIETNAM SOC REP
INDONESIA
MALAYSIA
THAILAND
TAIWAN
KOREA RP
TURKEY 0.00
1,000.00 2,000.00 3,000.00 4,000.00 5,000.00
Figure 5: India's Major Export Destinations
2017-18 2018-19
Value in Rs crore
Source: Department of Commerce
India’s major Export destinations in 2018-19 were Bangladesh, China & Pakistan.
Countries such as Bangladesh, China, Pakistan, Vietnam and Indonesia are scaling up their cotton imports from India to meet the requirements of their export-focused garment industries.
7. India’s Trade Flow during 2014-15 to 2018-19
Table 3: Trade Flow for India
Year Lakh Tonnes Lakh Bales
Export Import Export Import
2014-15 11.43 2.58 67.2 15.22
2015-16 13.46 2.32 79.17 3.64
2016-17 9.11 4.81 53.59 28.30
2017-18 9.86 4.49 58.01 26.41
2018-19 11.4 2.98 67.24 17.52
Source: Department of Commerce
India exported substantial quantity of cotton during 2013-14 to 2015-16 but gradually decreased during in 2016-17 & 2017-18 due to increase in domestic cotton prices whereas imports have been increased from last two years due to lower production. However, export has increased and import has decreased in 2018-18
8. Domestic Prices Movement
8.1 Price Movement for Raw Cotton (Kapas) at major Centers between May, 2018 and May, 2019
6-Oct-14 16-Dec-14
27-Feb-15 11-May-15
21-Jul-15 3-Oct-15
15-Dec-15 26-Feb-16
23-May-16 1-Aug-16
15-Oct-16 26-Dec-16
8-Mar-17 19-May-17
29-Jul-17 14-Oct-17
26-Dec-17 9-Mar-18
18-May-18 28-Jul-18
10-Oct-18 21-Dec-18
5-Mar-19 4500
5000 5500 6000 6500 7000
Variety wise Kapas Price trend (Rs/Qtl)
Rajkot (BT) Ahmedabad (S-6) Amravati (Mech-1) Hisar (BT)
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 between April, 2018 and April, 2019
5-Oct-15 18-Nov-15
31-Dec-15 13-Feb-16
28-Mar-16 10-May-16
21-Jun-16 2-Aug-16
17-Sep-16 2-Nov-16
14-Dec-16 25-Jan-17
10-Mar-17 24-Apr-17
5-Jun-17 18-Jul-17
1-Sep-17 16-Oct-17
28-Nov-17 11-Jan-18
23-Feb-18 7-Apr-18
19-May-18 2-Jul-18
13-Aug-18 26-Sep-18
10-Nov-18 22-Dec-18
6-Feb-19 20-Mar-19
3-May-19 4000
4200 4400 4600 4800 5000 5200
Lint Price Trend at Key Centers
Bhatinda Sirsa Abohar
(Rs./ Maund (of 37.32 kg each)
Source: Textile Commissioner
9 Movement of Domestic as well as International Prices of Cotton
Jun-13 Sep-13
Dec-13 Mar-14
Jun-14 Sep-14
Dec-14 Mar-15
Jun-15 Sep-15
Dec-15 Mar-16
Jun-16 Sep-16
Dec-16 Mar-17
Jun-17 Sep-17
Dec-17 Mar-18
Jun-18 Sep-18
Dec-18 Mar-19 100000
105000 110000 115000 120000 125000 130000 135000 140000 145000 150000
International and Domestic Price Comparison
Rs./Ton International prices (Cotlook A Index) Rs./Ton Domestic Prices ( Shankar-6) Source: International Price –cotlook.com, Domestic Price- Textile commissioner
Domestic Prices have been lower than International price since September, 2017.
10 Minimum Support Price (MSP) for Cotton during 2012-13 to 2016-17
(Unit: Rupees/Quintal ) Table 4: Minimum Support Price for Cotton
Staple Size 2014-15 2015-16 2016-17 2017-18 2018-19
Medium Staple Cotton 3750 3800 3860 4020 5150
Long Staple Cotton 4050 4100 4160 4320 5450
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 tremendously since last 5 years by 37.33 percent for medium staple and 34.56 percent for long staple cotton. The hike is made by the government to speed up the exports and to increase farmer’s income.
11 Future prices
(Unit: Cents/Pound) Table 5: Future Prices for Cotton
Date of
Contract 3_May_2019
3_Apr_201 9 (1 month
ago)
2_Feb_2019 (3 month ago)
4_Nov_2018 (6 month
ago)
3_May_2018 (Year Ago)
% Change
over a month
% Change over previous
year
1-May-19 74.78 77.05 74.93 81.63 84.45 -2.95 -11.45
1-Jul-19 75.68 77.77 76.21 82.67 84.5 -2.69 -10.44
1-Oct-19 74.27 76.67 74.45 79.6 81.3 -3.13 -8.65
1-Dec-20 74.45 76.25 74.12 78.87 79.59 -2.36 -6.46
1-Mar-20 75.03 76.68 75.36 -2.15
Source: Intercontinental Exchange (ICE).
Future prices for cotton are expected to decrease over previous year.
12 Price Movement in Major Domestic Mandis
(Unit: Rupees/ Quintal) Table 6: Price Movement in Major Domestic Mandis
Markets April, 2019 March, 2019 April, 2018
% Change (over previous month)
% Change (over previous year)
Rajkot 6302.6 5551 5331 13.54 18.23
Surender Nagar NA 5300 NA - -
Amaravati 6353.1 5410 5095.6 17.43 24.68
Guntur NA NA NA NA NA
Warangal NA NA NA NA NA
Sirsa 4845.2 4341 4231.8 11.61 14.50
Bhatinda 4904.2 4394 4252.7 11.61 15.32
Ganganagar 4486 4200 NA 6.81 -
Source: Agmarknet
Major domestic Mandis in India experienced an increase in prices in April 2019 over the same period of the previous year due to lower arrivals this season (See Table 6).
13 Cotton Arrivals in Major Domestic Mandis
(Unit: Quintals) Table 7: Cotton Arrivals in Major Domestic Mandis
Markets April, 2019 (cumulative)
March,2019 (cumulative)
April, 2018 % Change (over previous month)
% Change (over previous year) (cumulative)
Rajkot 53500 41415 43770 29.18 22.23
Surender Nagar NA NA NA - -
Amravati 71275 314000 32400 -77.30 119.98
Guntur NA NA NA - NA
Warangal NA NA NA - NA
Sirsa 7225 15555 9265 -53.55 -22.02
Bhatinda 31620 77350 44540 -59.12 -29.01
Ganganagar 8030 22700 NA -64.63 -
Arrivals in April, 2019 in major domestic mandis like Sirsa, Bhatinda and Ganganagar were less over the same period of the last year. This year major states were affected by low rainfall and got attacked by pink bollworm which resulted in decline in arrivals.
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)
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
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
****
Disclaimer: The information and opinions contained in the document have been compiled from various sources believed to be reliable. This Department will not be liable for any losses and damages in connection with the uses of the information provided in the commodity profile.
