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CAI raises cotton export estimates on weak domestic currency

Tuesday - May 26, 2020 1:03 am , Category : BUSINESS
New Delhi, May 26 (IANS) The Cotton Association of India (CAI) has increased its estimates of cotton export from 42 lakh bales to 47 lakh bales in the current cotton season 2019-20 (October-September) as weakness in the domestic currency may boost export demand.
Target of Indian cotton exports is increased by 5 lakh bales from 42 lakh bales to 47 lakh bales looking favourable conditions for exports as Indian rupee is depreciated by 8-10 per cent which is lending a big support, said the CAI in a statement on Monday.
The Indian cotton is the cheapest in the world at this time, said the industry body which reduced India's cotton import estimates by 10 lakh bales from 25 lakh bales to 15 lakh bales due to depreciation in rupee.
The CAI has also reduced the production estimates of cotton from 354.50 to 330 lakh bales.
Mentioning the reasons for lower estimates of cotton production, the industry body said, 'due to the availability of water, many farmers didn't not wait for the last picking of cotton and uprooted cotton plants and gone for rabi crop.
Apart from that, ginning factories were completely closed from March 25 to April 30 amid a nationwide lockdown, still they are running with merely 20-30 per cent of their capacities.
Labour shortage in ginning factories due to the lockdown is also a reason for reducing production estimates of cotton, said the industry body.
According to CAI, the domestic consumption of cotton is also estimated 280 lakh bales, down by 51 lakh bales from previous estimates of 331 lakh bales as mills were closed due to lockdown.

--IANS pj/pgh