Industry pegs carry forward stock at more than 70 lakh bales: government pegs at 50 lakh bales.
India seems to be heading towards record carry forward stock for the fiscal 2009-10. Cotton traders estimate that the new cotton season next fiscal will start with huge carry foward stock of cotton to the tune of more than 70 lakh bales, while government officials peg the figure at 50 lakh bales.
Industry players attribute lower cotton consumption and exports to unprecedented carry forward stock in 2009-10. "The textile industry across the globe is facing tough times. Apart from this, higher prices of Indian cotton has dented the cotton exports from the country. Cotton consumption domestically has seen drastic fall. As result, carry forward stock is expected to mount in time come", said Arun Dalal, owner of Arun Dalal & Co, an Ahmedabad-based cotton trading firm.
The carry forward stock for the fiscal 2008-09 was in the range of 40 to 43 lakh bales on account of higher consumption and exports. "However, the new cotton season starting in September-October in 2009-10 will have unprecedented carry forward. It may be around 70 to 80 lakh bales", said Kishor Shah, president, Central Gujarat Cotton Dealers Association (SGCDA).
When asked about the estimates of next season's carry forward stock, JN Singh, joint secretary, union ministry of textiles, said it might be approximately 53 lakh bales.
The jump in the cotton carry forward stock could be gauged from the fact that last year India produced 315 lakh bales of cotton, of which 241 was consumed locally and 85 lakh bales were exported. Both government as well as marketmen estimated cotton exports to be nearly 35 lakh bales in 2008-09. In fact, only 10 lakh bales have been exported so far. On the other hand, mill use consumption in India this year is expected to dip due to slowdown.
Cotton traders expect domestic cotton consumption to fall to 220 lakh bales as against the 241 lakh bales last year. All this will contribute to increase in carry forward stock for 2009-10. "Cotton Corporation of India (CCI) and other government agencies have procured 100 lakh bales of cotton at Minimum Support Price (MSP), of which 50 to 60 lakh are unsold", JN Singh added.