Cotton export touched 8.7 mln bales until May 2021
Cotton export in May was 8.85 lakh bales worth INR2,125 crore or US$290 million. This takes the total export to 87 lakh bales worth US$19,000 crore or US$2,600 million in the first nine months of 2020-21 marketing season. China was the largest market for Indian cotton during the month, followed by Bangladesh, Vietnam, and Indonesia. No shipment was reported to have been dispatched to Pakistan during the month.
Export price realisation for cotton averaged INR141 a kg or US cents 87.64 per pound during May. This was much below Cotlook A index, the global spot price benchmark and higher than domestic spot price for benchmark Gujarat Shankar-6. During the month, Cotlook averaged US$90.76 per pound while Shankar-6 was at US cents 81.90 per pound, implying that Indian cotton was competitive in global market.
It is likely that the 2020-21 season may end with total cotton export at just over 90 lakh bales, assuming about 0.5 lakh more bales will be exported in the next four months as usual. This would be whopping 34% increase over 67 lakh bales export in 2019-20 season and 70% more than that of 2018-19.
According to the Third Advance Estimates on Production of ministry of agriculture released in late May, India produced 365 lakh bales of cotton in 2020-21 which was just 1.2% more than in 2019-20. The WASDE in its latest June monthly report has estimated India production at 365 lakh bales and cotton export at 76 lakh bales. Domestic use is estimated at 301 lakh bales Including opening stock of 216 lakh bales and imports of about 10 lakh bales. This leaves a closing stock of 215 lakh bales for 2020-21 season.
Rains is expected to be benevolent over India this monsoon. Cotton sowing is reported to be at brisk pace in some region and below previous year levels in many. Area under cotton this season in Punjab has reportedly crossed the 3 lakh hectare mark. This is an increase of 17% over 2020, when cotton was sown on 2.5 lakh hectare. It is however, 41% short of the peak of 2011-12 when the 5.2 lakh hectare was under cotton.
