Textile mills body SIMA hails CCI initiative on cotton bulk

The Southern India Mills Association (SIMA) on Tuesday thanked Union Textile Minister Smriti Irani for volume based bulk discounts offered by the Cotton Corporation of India for the stock of cotton season 2018-19 and protecting the interests of MSME spinnng mills.

Considering the free lifting period and quality claimed by corporation for its cotton, the prices would come closer to the market levels and the mills might commence procurement from CCI, SIMA Chairman Ashwin Chandran said in a statement here.

He said the intervention by Irani enabled the CCI to offer volume based discounts and protect the interests of MSME spinning mills by offering discounts from 500 bales with an upper limit of 10,000 bales for purchase of cotton pertaining to crop year 2018-19.

The discount ranged from Rs.3,200 to Rs.4,400 per candy of 355 kgs and CCI has quoted Rs.46,400 per candy for 30 mm cotton of fair average quality while the current market price was around Rs.40,500, he added.

He expressed hope that CCI would soon offer its current year minimum support cotton at market prices at constant intervals till the end of the season and facilitate stability in cotton prices.

The SIMA chief appealed to the government to include cotton yarn under various export benefits such as interest subvention and refund of embedded blocked taxes and levies to make Indian cotton yarn, which attracts considerable tariff in all the export markets, globally competitive and thereby boost exports.

Cotton yarn export from the country has dropped around 30 per cent during 2019-20 when compared to the previous year, he said adding increased exports will stimulate demand for cotton.

This would in turn help the government to reduce the losses on account of MSP as CCI was on track to procure upto 100 lakh bales of cotton during the current cotton season, he said.

The industry has been pleading with the Textiles ministry to sell the cotton at market prices to have stability in the cotton market and protect the interests of the spinning mills and its downstream powerloom and handloom sectors, Chandran said.