Indian cotton imports may fall 10 to 15 per cent in the current year. Domestic cotton prices have fallen, encouraging mills to procure their raw materials locally. Imports are not likely to gain pace again as new shipments will reach Indian shores only by October or November, when local harvesting would have already commenced. So far, India has signed import deals for around 2.5 million bales in the current year. Of this, 1.1 million bales have already arrived, and the remaining is being shipped for July-September deliveries.

Imports may gain pace again only if the monsoon’s progress in India remains significantly weak in July as well, as it could threaten the kharif crop, which largely depends on monsoon rainfall. Steadily falling global prices along with weak demand for cotton yarn may drag domestic prices lower in the months ahead. Output is seen taking a hit as high summer temperatures, delayed onset of monsoons and water shortage especially in key cotton growing states of Telangana, Andhra Pradesh, Karnataka and Maharashtra have affected cotton yield, which has driven prices higher. Domestic spinning mills are inclined to import and save costs. However, it is hard for small and medium enterprises to import, as they may not have the financial muscle to buy and store.