Cotton production is expected to shrink to 240 lakh bales

12-Nov-2024 05:11 PM

The cotton production in India for the 2024-25 season is facing a significant decline, with the latest projections indicating a reduction of 14 lakh hectares in the sowing area and damage from natural calamities. The Union Agriculture Ministry has revised its estimates, forecasting a decrease in cotton output by 26 lakh bales, from 325.22 lakh bales in the 2023-24 season to 299.26 lakh bales in 2024-25. However, the US Department of Agriculture (USDA) has an even more pessimistic outlook, predicting a further shrinkage to just 240 lakh bales, down from 254 lakh bales last season.

This sharp drop in production will affect India's overall cotton availability, which is estimated at 361 lakh bales for the 2024-25 season. This total includes 98 lakh bales from the previous stock, 240 lakh bales from the current season's production, and 23 lakh bales of imports. Of this, 255 lakh bales are expected to be used domestically, while 13 lakh bales are projected for export.

Key shifts in cotton trade include:

• Domestic Use: Expected to rise by 5 lakh bales compared to the previous season (250 lakh bales in 2023-24 to 255 lakh bales in 2024-25).
• Exports: A decline by 10.1 lakh bales, from 23.1 lakh bales in 2023-24 to just 13 lakh bales in 2024-25.
• Imports: Expected to increase by 14.1 lakh bales, from 8.9 lakh bales last season to 23 lakh bales this season.

This reduction in production and exports, combined with increased imports and higher domestic use, will reduce the surplus cotton stock at the end of the 2024-25 season to 93 lakh bales, compared to 98 lakh bales in the previous season.

The cotton industry in India is facing significant challenges, with potential consequences for both domestic markets and international trade. The increased import dependence and reduced export potential may affect pricing and availability in global markets as well.