Cotton Market Update

An Expert's View about Cotton in India

Posted on: 21 Oct 2012

India’s 2012/13 cotton production is forecast 1.0 million 480 lb bales higher at 25.5 million bales.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Voluntary Public - Date: 10/1/2012 GAIN Report Number: IN2125 India Post: New Delhi Cotton Market Update Report Categories: Agricultural Situation Cotton and Products Approved By: David Williams Prepared By: Dhruv Sood Report Highlights: India’s 2012/13 cotton production is forecast 1.0 million 480 lb bales higher at 25.5 million bales, as late rains across central India have resulted in higher planted area and improved yield prospects in key cotton producing states. Cotton Production Forecast Higher Cotton area continued to expand during September according to the Ministry of Agriculture, rising to 11.4 million hectares. Planting of the winter cotton crop in Tamil Nadu and southern Karnataka is underway and is expected to result in additional plantings of between 50,000 and 100,000 hectares. Total area is estimated at 11.5 million hectares, significantly higher than the latest Cotton Advisory Board estimate of 11.1 million hectares reported in IN2114. After a poor start, monsoon rains were relatively strong across parts of central and southern India, helping to improve soil moisture and support yields for the late-planted cotton crop. Yields are expected to be moderately higher than previously forecast in northern Karnataka, Maharashtra, Gujarat and Madhya Pradesh where irrigation is limited and late rains are expected to support crop development. India’s cotton production is now forecast at 33.0 million 170kg bales (25.5 million 480 lb bales). Table 1: All-India Weekly Cotton Planting Progress D Planted Area (million Average area for this week (million Percent of ate hectares) hectares) Normal 22-Jun-12 2.11 - - 29-Jun-12 3.14 - - 6-Jul-12 4.66 - - 13-Jul-12 6.52 7.04 92.6 20-Jul-12 8.37 9.00 93.0 27-Jul-12 9.72 9.40 103.4 3-Aug-12 10.01 9.99 100.2 9-Aug-12 10.92 9.99 109.3 17-Aug- 104.9 12 11.03 10.51 24-Aug- 105.4 12 11.15 10.58 31-Aug- 105.5 12 11.28 10.69 7-Sep-12 11.35 10.73 105.7 14-Sep-12 11.44 10.82 105.8 24-Sep-12 11.49 10.86 105.8 Source: Ministry of Agriculture, Government of India TABLE 2. AREA, PRODUCTION & YIELD OF COTTON IN MAJOR STATES (AREA THA, PRODUCTION THOUSAND BALES OF 170 KGS, YIELD KGS/HA) Final Final Estimated Forecast STATE 2009/10 2010/11 2011/12 2012/13 Maharashtra Area 3,503 3,932 4,125 4,092 Production 6,575 8,200 6,825 7,600 Yield 319 355 281 316 Gujarat Area 2,625 2,633 2,962 2,400 Production 9,800 10,300 11,680 9,200 Yield 635 665 670 652 Madhya Pradesh Area 611 650 706 750 Production 1,525 1,700 1,730 1,350 Yield 424 445 417 306 Punjab Area 511 530 560 516 Production 1,300 1,600 1,600 1,650 Yield 432 513 486 544 Haryana Area 507 492 641 603 Production 1,525 1,400 2,200 2,100 Yield 511 484 583 592 Rajasthan Area 444 335 470 449 Production 1,200 900 1,590 1,200 Yield 459 457 575 454 Andhra Pradesh Area 1,475 1,784 1,879 2,022 Production 5,450 5,300 4,950 5,500 Yield 628 505 448 462 Karnataka Area 455 545 554 441 Production 1,225 1,000 1,290 950 Yield 458 312 396 366 Tamil Nadu Area 104 122 133 100 Production 500 500 430 420 Yield 817 697 550 714 Others Area 75 119 148 143 Production 200 400 395 400 Yield 453 571 454 476 Loose Production 1,200 2,610 2,610 2,600 All-India Area 10,310 11,142 12,191 11,516 Production 30,500 33,910 35,300 32,970 Yield 503 517 493 487 Source: Cotton Advisory Board as of August, USDA Mumbai for 2012/13 production estimates Exports Unchanged, Imports Lower Preliminary official data for March through June suggest that 2011/12 (Aug/Jul) exports were nearly 14.2 million 170 kg bales, 300,000 bales higher than the previous FAS Mumbai estimate of 13.9 million 170 kg bales. However, given the tendency for these preliminary data to overstate exports, FAS Mumbai recommends holding the 2011/12 estimate at 13.9 million 170 kg bales (10.9 million 480 lb bales) pending final official monthly data. The FAS Mumbai estimate is higher than the USDA Washington estimate of 10.5 million 480 lb bales. Cotton imports during June and July appear to have fallen short of industry expectations and 2011/12 imports are estimated 200,000 480 lb bales lower. Higher 2012/13 production is forecast to lead to lower imports of 600,000 480 lb bales. Table 3: Estimate of 2011/12 Cotton Exports 170 kg Metric Tons 480 lb August 441,476 75,051 344,609 September 939,759 159,759 733,560 October 696,288 118,721 545,127 November 2,090,465 355,379 1,631,781 December 1,620,265 275,445 1,264,751 January 2,524,847 429,223 1,970,848 February 2,325,259 395,294 1,815,058 Official Subtotal Aug-Feb 1\ 10,638,359 1,808,521 8,304,125 March 530,147 90,125 413,824 April 1,395,535 237,241 1,089,327 May 819,718 139,352 640,038 June 577,018 98,093 450,538 Preliminary Subtotal Mar-Jun 2\ 3,322,418 564,811 2,594,027 Estimated Exports July 3\ 200,000 34,000 156,116 Total 14,160,777 2,407,332 11,054,268 1\ Official subtotal reflects estimates from the Directorate General of Foreign Trade, for Harmonized Tariff Schedule code 5201 – raw cotton. 2\ Preliminary official data from the Directorate of Commercial Intelligence and Statistics. These data are subject to revision, but are considered a fairly reliable predictor of final official data. 3\ FAS Mumbai estimate Table 4: Estimate of 2011/12 Cotton Imports 170 kg Metric Tons 480 lb August 8,735 1,485 6,820 September 2,518 428 1,966 October 12,647 2,150 9,875 November 14,665 2,493 11,450 December 12,847 2,184 10,031 January 37,759 6,419 29,482 February 81,771 13,901 63,847 Official Subtotal Aug-Feb 1\ 170,942 29,060 133,472 March 97,824 16,630 76,381 April 97,018 16,493 75,752 May 81,147 13,795 63,360 June 35,682 6,066 27,861 Preliminary Subtotal Mar-Jun 2\ 311,671 52,984 243,354 Estimated Imports Jul 3\ 30,000 5,100 23,424 Total 512,613 87,144 400,250 1\ Official subtotal reflects estimates from the Directorate General of Foreign Trade, for Harmonized Tariff Schedule code 5201 – raw cotton. 2\ Preliminary official data from the Directorate of Commercial Intelligence and Statistics. These data are subject to revision, but are considered a fairly reliable predictor of final official data. 3\ FAS Mumbai estimate Table 5: Monthly Cotton Consumption by the Textile Sector (Million 170 kg bales) 2009/10 2010/11 2011/12 Aug 1.859 2.173 1.806 Sep 1.829 2.143 2.167 Oct 1.812 2.209 1.768 Nov 1.847 2.110 1.817 Dec 1.949 2.257 2.007 Jan 1.954 2.210 2.039 Feb 1.881 2.023 2.026 Mar 2.001 2.176 2.028 Apr 2.053 2.017 2.022 May 2.093 1.864 2.138 Jun 2.071 1.823 2.085 Jul 2.211 1.898 2.115 Total 23.56 24.90 24.12 Does not include annual loss estimates of 1.7, 2.0 and 1.6 million bales respectively. Additional Revisions USDA Mumbai is again recommending revised 2010/11 import and export estimates based on official trade data. The 2010/11 consumption figure reflects revised official data. FAS Mumbai continues to recommend lower forecast consumption for 2012/13. Cotton India 2010/2011 2011/2012 2012/2013 Market Year Begin: Aug Market Year Begin: Aug Market Year Begin: Aug 2010 2011 2012 USDA New USDA New USDA New Official Post Official Post Official Post Area Planted 0 0 0 0 0 0 Area Harvested 11,140 11,140 12,200 12,191 11,500 11,500 Beginning Stocks 9,374 5,922 9,924 6,912 7,674 4,062 Production 26,400 26,400 27,500 27,500 24,500 25,500 Imports 450 190 600 400 1,000 600 MY Imports from 0 0 0 0 0 0 U.S. Total Supply 36,224 32,512 38,024 34,812 33,174 30,162 Exports 6,000 5,000 10,500 10,900 3,500 3,500 Use 20,700 21,000 20,100 20,100 21,500 21,000 Loss -400 -400 -250 -250 0 0 Total Dom. Cons. 20,300 20,600 19,850 19,850 21,500 21,000 Ending Stocks 9,924 6,912 7,674 4,062 8,174 5,662 Total Distribution 36,224 32,512 38,024 34,812 33,174 30,162 1000 HA, 1000 480 lb. Bales, PERCENT, KG/HA
Posted: 21 October 2012

See more from Cotton in India

Expert Views    
Cotton and Products Annual   By Foreign Agricultural Service
Cotton Market Update   By Foreign Agricultural Service
India Modifies Cotton Export Ban   By Foreign Agricultural Service
Cotton Market Update   By Foreign Agricultural Service
Latest News    
India Bans Cotton Exports   By Foreign Agricultural Service