Cotton planting in India is likely to rise by 15 per cent in the 2017-18 planting season. Higher output in India could kill a rally that pushed global cotton prices to their highest in three years this month.

A 15 per cent rise in crop area would lift India's cotton planting to around 12.08 million hectares in the marketing year starting in October. Most Indian farmers start planting cotton - a crop that requires lots of moisture - with the onset of rains in June, although some with irrigated fields start as early as May. India looks likely to receive above average monsoon rainfall as concern over the El Nino weather condition has eased.

Oilseeds and pulses compete with cotton in key producing areas like Maharashtra and Gujarat. Prices of oilseeds and pulses plunged as much as 60 per cent due to bumper production this year, which will force many of them to switch to cotton. Pakistan, Bangladesh, China and Vietnam are key buyers of Indian cotton.

However, in the last few months Indian textile mills have been aggressively importing cotton due to an appreciation in the rupee. The country is likely to import a record three million bales in the current year.