India has shipped some six lakh bales of cotton to China. But some are either in the middle of the sea or lying at ports in China as there are no officials to unload the consignments. As a result, the payment cycle is stuck since no banks are open to clearing the letters of credit.

Cotton prices have gone down owing to the weak market sentiment. Private traders buying cotton from farmers at Rs 5,200 per quintal are now offering Rs 5,000 per quintal. The cotton yarn business has been hit more than cotton trade. So far, 28 lakh bales have been exported. Bangladesh, Vietnam and Indonesia are other export destinations. Bangladesh accounts for 20 lakh bales to 22 lakh bales and seven lakh to eight lakh bales go to Vietnam. The Cotton Corporation of India is estimated to have purchased some 68 lakh bales from farmers under MSP operations. While wholesale prices are hovering near the MSP of Rs 5,550 per quintal, traders are cautious of them falling once the quality of cotton arriving in the markets deteriorates.

Cotton export shipments already shipped from October 1, 2019, to January 31 this year are estimated at 20 lakh bales, while the balance 22 lakh bales are expected to be shipped during February 1 to September 30 this year.