According to the latest forecast released by the Indian Cotton Association, India’s total cotton output in 2020/21 will remain at 35.6 million bales, and India’s total cotton supply and consumption in 2020/21 will still be 47.75 million bales and 33 million bales, respectively. No adjustment has been made; however, India’s cotton export volume in 2020/21 was reduced to 5.4 million bales from 6 million bales last month, resulting in an increase in ending stocks.
Several international cotton merchants and traders said that because Biden has stated that he will not take any action on the first phase of the Sino-US economic and trade agreement and comprehensively reviews China policies, the price difference between domestic and foreign cotton continues to be high and 2020 /In 21, US cotton grade and quality indicators were higher than expected and other positive factors, coupled with the lack of significant improvement in relations between China, India, India and Pakistan, soaring sea freight, and Indian domestic cotton prices “opening higher” under the support of CCI, etc. Affected by multiple factors, Indian cotton exports in 2020/21 face competition from US cotton, Brazilian cotton, West African cotton, etc., which are not only very fierce, but also at a disadvantage. Therefore, it is more reasonable to reduce the export volume to about 5.5 million tons.
According to feedback from CAI, CCI and private processing companies in Gujarat, Maharashtra, Telangana and other places, due to prolonged rainfall and insect infestation from September to November The flooding and the damage caused by the early locust plague will not only greatly affect the grade and quality of cotton in 2020/21, but also the yield and total output will decline significantly. However, CAI has not lowered the total cotton output forecast for 2020/21 again. , mainly based on the following three reasons:
First, driven by CCI’s acquisition at MSP price and the continuous increase in CCI’s sales floor price, Indian cotton prices have increased by nearly 14% since September. If CAI is significantly lowered again In the 2020/21 cotton production, Indian cotton prices may “take off” under the influence of policies and funds, which is not conducive to the cotton textile and clothing industry in the post-epidemic period to increase startup load and receive orders;
The second is CAI The difference with the USDA’s output forecast is already quite large. Another downward revision may cause cotton enterprises, cotton textile mills and speculative institutions to doubt the objectivity and fairness of CAI. USDA’s latest monthly report shows that India’s total cotton output in 2020/21 is 6.532 million tons (no adjustments have been made in the past two months), while CAI’s forecast output is only 6.052 million tons (170 kilograms per bag). The difference between the two is 480,000 tons. It can be said to be not big;
Thirdly, the production measurement and production reporting in various cotton areas in India are relatively confusing and irregular. There are situations where local governments repeat statistics and the production estimation deviation is large. Several major cotton producers that have been severely affected have Statistics on district yield, total output and quality indicators have not yet been finalized, so it is somewhat difficult for CAI to take the initiative to revise the data. </p
