India's cotton output is likely to decline in the next season starting October 1 on account of deficient rainfall. India likely to produce 37.7 million bales in the 2015-16 season, as per the data compiled by Cotton Association of India (CAI).
India's cotton output in the current marketing season stands at 38.3 million bales (One bale equals 170 kg.). Lower output may drive up domestic cotton prices and further dent exports, as local prices are already ruling above the global levels.
Meanwhile, domestic cotton consumption is forecast to rise to 32.5 million bales in 2015-16, up 3.2% from a year earlier. Cotton imports are projected to remain unchanged at 1.2 million bales in 2015-16. Exports are expected to suffer in view of a slowdown in China, largest cotton buyer. India's monsoon declined 14% from the benchmark long-period average so far this year, as per latest data. This has had a negative impact on the country's cotton crops.