August 02, 2015 PUNE: Industry body Cotton Association of India (CAI) expects the 2014-15 cotton production to be surplus than the domestic requirement. With huge carrying stock with the Cotton Corporation of India (CCI), CAI has said that apprehensions of major support price operation at the begging of the next cotton season loom large.
CAI has retained its June estimate of the cotton crop for the season 2014-15 at the same level as in the last month and placed the same at 382.75 lakh bales of 170 kgs each.
The projected balance sheet drawn by the CAI for the year 2014-15 estimates total cotton supply at 453.65 lakh bales while domestic consumption is estimated at 315.00 lakh bales thus leaving an available surplus of 138.65 lakh bales.
The Cotton Corporation of India (CCI) has procured about 87 lakh bales to provide price support to the cotton farmer. CAI fears that a large quantity of cotton procured by the CCI will remain unsold. "Unfortunately, the CCI has not been able to sell the entire quantity of cotton procured by it and looking to the pace at which the cotton procured by CCI is getting disposed, a sizeable quantity of cotton is likely to remain unsold at the end of the season. This augurs very badly for the country and apprehensions of a major support price operation at the beginning of the next cotton season itself are looming large," stated a CAI release.
The release further stated: "A faulty Reserve policy of China has led to it holding today a stock equivalent to its cotton consumption of about 2 years. Although China has stopped procuring cotton from the farmers and has started giving direct subsidy to the farmers from this year, it is still sitting on a huge stockpile which now it finds hard to dispose."
CAI has warned that India needs to learn a lesson from the mistakes that China made and dispose of the cotton lying with CCI quickly, to avoid getting into a China like situation.