Cotton output may dip 11% on steep fall in yields

Acreage under cotton down by 7.5% as fall witnessed across states due to poor return during previous season

Cotton production in India is estimated to be lower by 11% at 335 lakh bales in the current year due to lower acreage and drastic reduction in yields, says a report.

"The cotton production is estimated at 335 lakh bales this year as against 376.6 lakh bales of last year, lower by 11%. Lower production is mainly attributed to lower acreage and drastic reduction in yields in North India due to white foly infection," said Edelweiss Agri Research.

Acreage under cotton is down by 7.5% as fall is witnessed across the states due to poor return during the previous season.

Overall yields are expected to come down by 3.8%, majorly because of drastic reduction in yields in North Indian states as yields in these region is expected to reduce by 35% year on year, the report said.

It is feared that there could be more reduction in yields as many fields can't be harvested as infestation is very severe, some farmers may opt for only one picking as harvesting cost is higher and yields in 2nd picking may nor be sufficient to pay labour wages, it added.

However, yields are expected to remain higher year-on-year in Central Indian states - Gujarat, Maharashtra and Madhya Pradesh.

The yields in Andhra Pradesh and Telangana region are expected to be lower by 1.5%.

In Karnataka acreage is lower by 24.3% on reduced sowing activity in major growing districts.

Realization to farmers on their own land is positive across cotton growing states, the report said, adding that those working on rental land are making loss in Maharashtra and North India.

Historical arrivals pattern shows that around 70% arrives in the market during November-February months. Due to early harvest, pace of arrivals is expected to be faster this season.

The report said that cotton prices slipped much below the Minimum Support Price last year, and as a result government had to procure record cotton estimated at around 87 lakh bales of 170 kg each. Due to falling production for a second year in a row, the government intervention is expected to be lower.

The North West region of Punjab and Harayana is a major cotton consuming region, crop failure in this region will support prices in central and western India.

Also, lower crop in Pakistan will see higher exports to all the three neighbouring nations Bangladesh, China and Pakistan, it said.