India's cotton stocks are set to plummet by almost 31 per cent in the 2023/24 period, hitting their lowest levels in over three decades, reports the Cotton Association of India (CAI). This decline, driven by decreased production and increased consumption, may curtail exports from the world's second-largest producer, impacting global prices positively. However, it could spell trouble for domestic textile firms, potentially inflating local prices and squeezing margins.
Projections indicate that by the end of the marketing year, cotton stocks could dwindle to a mere 2 million bales (340,000 metric tons). CAI forecasts India's cotton production for the current season at 30.97 million bales, a slight decrease from the previous year's 31.89 million. Meanwhile, domestic consumption is anticipated to rise to 31.70 million bales compared to 31.10 million previously.
Despite the impending shortage, CAI predicts an uptick in India's cotton exports for the season, estimating a rise to 2.20 million bales from 1.55 million last year. India primarily exports cotton to major destinations including China, Bangladesh, and Vietnam.
