MUMBAI: India’s cotton imports rose by around 800,000 bales to 2.3 million bales till August 31 this cotton season compared to the previous cotton season due to lower international rates than domestic prices, India Ratings and Research said. The cotton season runs from October to September.

Cotton prices continued to reduce in August 2019, mainly due to a fall in international prices. The agency expects the prices to fall further as global production is likely to be higher than the demand growth.

“With local prices (MSP) being higher than international prices, cotton imports are rising. Till 31 August 2019, the import of cotton was 2.3 million bales, up 0.8 million bales than that recorded in the previous cotton season. This would further reduce domestic cotton prices,” India Ratings and Research said in a report.

Cotton yarn continues to see reduced exports owing to low demand of yarn and increased competition.

“Exports fell 40 per cent month-on-month during July 2019, mainly due to the 80 per cent year-on-year fall in the demand from China. China has entered into second phase of free trade agreement with Pakistan on goods worth USD 64 billion, of which cotton yarn directly competes with India’s,” the report said.

Source: dst.news