After increasing tariffs on US imports, China has contracted to import 500,000 bales of cotton from India. As a result, the overall cotton export in India is likely to rise by 21 per cent to seven million bales for the cotton year ending this September, from 5.8 mn bales the previous year.
The price of the benchmark Shankar-6 variety of cotton has risen by 6.5 per cent in June so far, to Rs 13,160 a quintal from Rs 12,373 a qtl. The price has increased 12 per cent, in the course of a month.
There has been an increase in orders for Indian cotton from China, along with yarn, following a build-up in its trade war with the US. China has imposed 25 per cent duty on import of cotton from the US and is meeting its demand by sourcing more from India, in a repay in kind measure.
