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New Delhi -India will likely miss its year-end cotton stocks target of 5 million bales, despite placing tighter regulations on exports, a senior government official said Tuesday.
Stocks are expected to come to around 4 million bales, weighing 170 kg each, by the end of the marketing year on Sept. 30, said the official, who didn't want to be identified.
The 1 million bale shortfall will likely drive prices higher and hurt the margins of local textile mills.
India, the world's second-largest cotton supplier, in May lifted a ban on cotton exports within a month of implementing it. The ban was replaced with stringent regulations on shipments and an export tax as the government tried to strike a balance between cotton farmers' earnings and textile mills' supplies.
The textile industry has sought curbs on cotton exports as local prices of the fiber have risen more than 30% since the start of the year to INR29,600 per candy. One candy weighs 356 kilograms.
Industry officials have warned that, unless the export ban is reimposed, prices could still rise to INR30,000 per candy this year as hardly any supplies are left with farmers, despite the tighter regulations.
India's cotton exports have already more than doubled from last year to around 7 million bales. Total shipments are likely to reach around 8 million bales in 2009-10.
India, also the world's second-largest cotton grower, expects to produce 29.2 million bales this marketing year.
09 June, 2010 by admin