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The Textile Magazine
APRIL 2012
CCI intervention to ensure
cotton price stability
fiber
value chain, ranging from farmers, ginners, millers and
traders.
On a particular day recently, CCI purchased approxi-
mately 11,000 bales at Rs. 4,400 per quintal from major
mandis across Gujarat.
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The Ministry of Textiles is monitoring, on a daily ba-
sis, the arrivals of cotton and the price situation across
major mandis. Currently cotton prices are stable, aver-
aging around Rs. 4,000 per quintal, way above the MSP
prices fixed at 3,100 per quintal, eliminating the
need for MSP operations. However, in order to
secure the raw material supply lines for the domes-
tic requirements of the textile sector, commercial
operations by the Cotton Corporation of India
(CCI) have become imperative.
CCI has been directed to intervene in the
market for commercial operations to build up
reserves of 25 lakh bales till the cotton arrivals in
the new cotton season of 2012-13. This has been
necessitated by the fact that the textile industry,
impacted by a slowdown, is unable to carry stocks be-
yond 15 days, whereas the mandatory carryover stock
requirement is 60 lakh bales at 85 per cent efficiency.
CCI is expected to purchase at the prevailing market
price approximately 10 lakh bales each in the next two
months.
This considered decision has been taken to ensure
price stability in the market as also availability of cot-
ton for the domestic user industry, keeping in mind the
varied interests of stakeholders across the entire cotton
India, China policies hit global cotton trade
Policies adopted by India and China, the world’s two biggest cotton producers, have affected global cotton
trade and prices this year, according to the International Cotton Advisory Committee (ICAC).
“This season, global cotton trade and prices are affected to a large extent by government policies in China and
to a lesser extent by policies in India,” the US-based ICAC said in a statement.
China imported in a big way to build reserve, while India has stopped further cotton exports.
“China accumulated over three million tonnes of domestic cotton and at least one million tonnes of foreign cot-
ton in its national reserve during the first eight months of 2011-12,” the statement added.
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