Ginning industry demands rationalisation of cotton MSP

With Cotton Corporation of India (CCI) stepping up cotton purchases, ginning industry has started feeling the pinch of around 40 per cent hike in Minimum Support Price (MSP) of cotton. Cotton prices have bounced back after the entry of CCI in the market resulting into a loss of Rs. 30 per 20 kg to ginners.

Farmers are reluctant to sell cotton below MSP as CCI is purchasing cotton at support prices. The cotton prices had tanked to Rs. 21,000 to Rs. 22,000 per candy last month. With CCI entering the market, the prices have again surged to touch a Rs. 23,000 per candy level.

“Ginners can not afford to buy cotton at such high levels. As per current prices, ginners are incurring a loss of Rs. 30 per 20 kg and we have reduced cotton purchases due to higher prices”, Manubhai Shah member of All Gujarat cotton Ginners Association told Business Standard.

Considering the problems faced by ginners and other industry players, ginners, spinners, textile and apparel mills have demanded rationalisation of cotton MSP. Various representatives of ginning, spinning and textile mills associations are slated to meet Union Agriculture Minister Sharad Pawar tomorrow.

“Steep hike in cotton MSP is irrational and we are going to demand rationalisation of cotton MSP,” said Dilip Patel, president of all Gujarat cotton Ginners Association. Representatives of various trade bodies from nearly 10 states are likely to meet agriculture minister.