Cotton market soars as rupee falls against dollar

ST CORRESPONDENT
Thursday, 6 September 2018

Pune: As the rupee has fallen to a great extent against the dollar, the decrease caused by that in the imports and the increase in export deals, has created a fruitful environment for cotton in the domestic market and rates of the commodity have shot up in the domestic market. The rates for the 35 to 37 mm length thread variety cotton has reached Rs 61,000 for a bundle weighing 356 kilograms in the Jalgaon wholesale market.

Pune: As the rupee has fallen to a great extent against the dollar, the decrease caused by that in the imports and the increase in export deals, has created a fruitful environment for cotton in the domestic market and rates of the commodity have shot up in the domestic market. The rates for the 35 to 37 mm length thread variety cotton has reached Rs 61,000 for a bundle weighing 356 kilograms in the Jalgaon wholesale market.

The rates for the 29 mm thread variety has increased by 7 per cent and reached Rs 48,000 for the 356 kg bundle. Last week the American cotton market closed at 82 cents. The trade war between China and America too has affected the cotton market, causing a drop in the rates of the cotton, but as the dollar reached the rate of Rs 70.21,  the rates which had fallen to Rs 47,500 per bundle, jumped to Rs 48,000 a bundle. Indian cotton trade is reaping the benefit of increased export deals. The longer threads are also less preferred by Indian mills.

The import of the Pima and Giza varieties from Australia, America and Turkey are costing around Rs 71,000 to 72,000. The quality of these thread variety cotton is possible to be fulfilled within the country itself and hence there have been more deals being made within the domestic market too. These high-quality thread varieties are fetching a record Rs 61,000 per bundle. These cotton are being supplied to the market from regions like Tamil Nadu and Orissa, which has produced 10,000 bundles (170 kg) of cotton. Other varieties of cotton like the DCH which has seen a production of 1.5 lakh bundles in the Ratlam, Sillod and Kannada regions. 

Cotton is fetching anywhere between Rs 5,600 to 5,800 for a quintal for the farmers. The Centre has set the price of the longer varieties of cotton at Rs 5,450 per quintal, which will ensure that prices don’t fall below these. Maharashtra, Punjab and Haryana will see the harvest begin by the end of September and the yield might be good too, according to experts.

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