By admin       2018-07-11

USDA Reduces Indian Cotton Production Marginally On Delayed Monsoon Rainfall.As per the latest update from United States Department of Agriculture (USDA) , Indias cotton production for MY 2018/19 is estimated at 28.7 million 480 lb. bales on 11.85 million hectares. Erratic rains have delayed planting, but weather forecasts indicate the monsoon will advance through the first half of July and hasten planting. The Indian currency weakened to its lowest level in the past decade and, as a result, cotton and cotton product exports have been stronger than estimated.India forecasts cotton planting for MY 2018/19 will be on 11.85 million hectares. The FAS India forecast is 50,000 hectares higher than the official USDA estimate as planting in central India (i.e., Gujarat and Maharashtra) is expected higher. In addition, trade sources report a much higher Minimum Support Price (MSP) for cotton is expected and this will likely affect sowing decisions in the coming weeks.USDA forecasts MY 2018/19 consumption at 25 million 480 lb. bales (32 million 170 kg bales/5.44 mmt) which is 200,000 480 lb. bales lower than the USDA official forecast. Trade sources indicate higher consumption compared to last year as demand for cotton yarn for export markets improved. Indian cotton prices remain one of the cheapest in the world and mills report ample fiber supplies (domestic and imported cotton) to cater to both domestic and export market customers.India forecasts MY 2018/19 exports at 4.2 million 480 lb. bales (5.4 million 170 kg bales/ 914,442 MT). Export prospects for MY 2018/19 softened, as global demand for cotton from alternate origins is much higher. Even though India ex-gin prices are cheaper than the Cotlook A Index and a weaker rupee should encourage exports, demand has been, instead, for Indian cotton yarn exports. The Post MY 2018/19 import forecast at 1.6 million 480 lb. bales (2 million 170 kg bales/ 348,359 MT) is higher than the USDA official forecast. Post anticipates imports to remain strong as mills import for processing and re-export as yarn or fabric to cover various external commitments.

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