Cotton Board To Review Crop On Feb 24
The Cotton Advisory Board (CAB) will meet on February 24 at Mumbai to review the cotton crop situation for the year 1996-97, and to discuss the present export quota position as well as the fabric and yarn policies.
According to sources, the government has declared an export quota of 12.20 lakh bales of all qualities of produce so far.
Out of this, staple cotton takes up 10.65 lakh bales and if the countrys crop for the 1996-97 season is estimated at approximately 160 lakh bales of 170 kgs each, this constitutes of about 7.6 per cent of the total crop.
During 1995-96, too, the government had released a total quota of 15.90 lakh bales out of which, 12 lakh bales were sold.
The government had also extended the time limit of export quota of unshipped goods of one lakh bales up to February 28.
It is pertinent to note that the percentage of export quota to the total crop was significantly high during the last season too.
Despite the releases of large export quota of raw cotton well in time, the declining trend in cotton prices has not been arrested.
Sources said the sluggish demand in the textile industry in the domestic market is the main reason for the declining trend.
The mills, which used to cover the cotton requirements for about three/four months, are now holding just 15 to 30 days inventory because of liquidity crunch, said sources. They add that the mills are in dire straits as the lifting of cotton yarn by the powerloom sector for weaving has been very tardy and the turnover of cash is still very poor.
It is also indicated that there is a change in the pattern of yarn production with the concentration being on medium and coarse stuff. The finer counts are less in demand because these have become costlier.
Also, the arrivals of cotton from the producing centres to the mandis have remained around 10 lakh bales less than what it was in the corresponding period of the previous year.
The arrivals by December 1996 were 56.06 lakh running bales as against 46.66 lakh bales which landed in December 1995.
The trade estimate of the cotton crop for the 1996-97 season is around 160 lakh bales, whereas the textile industry is of the opinion that the crop is likely to be around 158 lakh bales of 170 kgs. each.