Express say, the burden of an unsold stock coupled with unstable demand may translate in price downtrend for cotton in India for most of the year. While unsold amount of cotton is high on one hand, there have been lower expectations of any big jump in demand for the commodity. Currently cotton price is ruling at Rs 34,200-34,500 per candy of 355 kg and may fall to Rs 33,000 in next month or two. Moreover, according to traders, even if demand rises, the stock is enough to meet the same.

According to recent estimates by the Cotton Association of India (CAI), as against production estimates of 34.10 million bales (a bale of 170 kg) in the cotton year 2015-16, the arrivals till March 31, 2016 have been at around 28 million bales, down by 12 per cent from last year's arrivals of 31.84 million for the said period. Last year, the cotton production stood at 37.5 million bales.

As per the trade estimates, India has exported about 5.5 million bales so far and nearly one million more export is expected by end of the season. On the other hand, some in the industry believe that there is about 4.5 million bales of stock with India which is not sufficient to fulfill the demand in coming days and this may push prices on upside.