Cotton Corporation of India (CCI) has plans to procure 15 per cent of the country’s total output of the crop this year in order to prevent distress sales. The Cotton Association of India (CAI) estimates output at 40.55 million bales this year, a marginal decline from 40.73 mn last year. Of that, CCI plans to buy six mn bales from the open market.
Normally, CCI intervenes to buy cotton when the spot price falls below the minimum support price fixed by the Centre. Early this month, the price went below the Rs 3,750 a qtl MSP in some parts of Andhra Pradesh and Telangana. Following which, the Union agriculture ministry sought CCI’s intervention. Accordingly, CCI has procured 800,000 bales so far from farmers in the two states. This helped arrest the price; the benchmark Shankar-6 variety is currently quoting a bit higher than the MSP.
MSP operations will intensify in the coming days. They plan to procure six mn bales this year, which will cost Rs 12,000 crore, for which it has made arrangements with a consortium of 14 banks led by Bank of Baroda for fund raising. CCI has evinced interest in export as well, in case the price remains competitive abroad. Exports so far this year have been 500,000 bales. The value of cotton now being produced in the country every year is $16.5 billion in seed cotton form. Consumption in India has also witnessed a healthy growth and is estimated at 30.6 million bales during 2014-15. India exported 11.79 million bales in 2013-14 and the approximate value of cotton now being exported from India every year is $3.3 billion.
MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.
To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.
MoneyWorks4Me ensures this through: