Know the reasons, statistics, and experts’ opinion

Cotton prices have been witnessing a continuous decline for the last few weeks. This decline is not limited to India only, but its impact is visible in global markets as well. Cotton prices in America have fallen below $69.50 per pound. In this article we will discuss in detail the reasons behind falling cotton prices, global production and consumption figures, and experts’ opinions.

Trend of cotton prices in last few weeks

• US market decline:
  In November 2024, cotton prices were above $ 73 per pound, but now they have fallen to $ 69.50 per pound.
• One month change:
  A decline of more than 3% has been recorded in a month.
• From the beginning of 2024:
  There has been a decline of about 15% since the beginning of this year.
• Long-term decline:
  A 14% decline in prices has been observed in the last one year.

Assessment of global cotton production and consumption

production figures

Cotton production has increased in the world, due to which pressure is being seen in prices.

• Global Production:
  Cotton production is estimated at 117.4 million bales in 2024.
• Increase in November:
  There was an increase of 1.2 million bales in November.
• India and Argentina:
  India gained 1 million bales, while Argentina also had higher production.

consumption data

• World Consumption:
  Consumption increased by 5,70,000 bales.
• Countries with high demand:
  Demand for cotton remained high in Vietnam, Pakistan and India.

Cotton market situation in India

Prices and government purchases in India

• Indian market decline:
  Cotton prices in India have fallen from Rs 62,000 to Rs 54,000.
• Role of CCI:
  Cotton Corporation of India (CCI) has purchased 70% of the cotton at MSP, which has brought some stability to the market.

Position of Ginners and Traders

• Ginners and traders have less work, while spinners have made profits.

Increasing dominance of global e-textile market

The textile industry is also being affected by changes in cotton prices.

• market development:
  The global e-textile market turnover is estimated to reach $6.8 billion by 2030.
• Situation in 2024:
  This business will exceed $ 2.5 billion in 2024.
• Bullish data:
  An annual growth of 19% has been observed since 2019.

Historical Cotton Prices

• March 2011 records:
  Cotton prices hit a record high of $227 per pound in March 2011.
• Current Price:
  Now it is at the level of $69.50 per pound.

expert opinion

Spinners Association statement

Spinners Association Vice President Ripal Patel says that the time has come to compensate for the losses incurred in the last two years.

Atul Ganatra (CAI President)

• Global decline:
  Cotton prices in America have fallen by 30-35%.
• Indian Market Analysis:
  He said that the decline in the Indian market also continues. However, CCI’s MSP buying has stabilized the prices a bit.
• Prediction:
  There is little possibility of price rise even in 2025 as there is sufficient stock available in the global market.

India vs Brazil: difference in cotton production

• Indian production:
  The average production in India is 450-475 kg/hectare.
• Brazil’s High Production:
  In Brazil this figure ranges from 1800-1900 kg/hectare.

Main reasons for pressure on cotton prices

1. High global production:
   Production remained high in 2024, putting pressure on prices.
2. Falling Demand:
   Despite a slight increase in consumption, demand remained lower than production.
3. America’s bumper production:
   The US produced 14.3 million bales of cotton in December.

future scenario

• Cotton Prices:
  Experts believe that there is no possibility of a rise in prices in the near future.
• Global Stock:
  Prices may fall further due to adequate stocks.