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India:Cotton textile mill cotton consumption touch record high in ’04-05 |
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2004-11-18
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The Indian mill use and production in marketing year (MY), August to July 2004-05 are expected cross all previous records. While the consumption s placed at 3.0 million metric tons, up 4% from the previous year, the production is predicted at 3.1 million metric tons, up 3% from last year.
As for the consumption of cotton, India is already the second largest user of cotton in the world with an average 2.9 million metric tons of mill use per annum.
The Multi-Fiber Arrangement (MFA) is expiring beginning next year and experts have forecast measurable gains all due to low production cost and quality that the apparel and textile industries of the country stands to gain from.
Though China will benefit the most from the above scenario, the Chinese mill use raised because of tighter credit, increasing labour and energy costs, and the threat of US safeguards turn India as better preposition as an alternative. Targeting both domestic and export markets has helped the apparel industry to grow at an annual rate of 15 to 20%.
This year’s cotton output is also predicted to cross previous record and at an average 2.6 million metric tons per year. India currently, is the third largest cotton producer in the world. With the exception of some high-quality ELS, India produces most of the cotton used by its textile industry. This year, above average off season rainfall along with combination of factors like low pest attack, favourable climatic condition as also cultivation of high yielding Bt cotton, will boost cotton output to a record high.
Additionally, production increase is also attributed to more and newer areas being brought under cotton cultivation. All this was due to last year’s record yields and high cotton prices, combined with extended monsoon rains, have encouraged Indian cotton farmers to plant more area. Yield per hectare in the country is expected to jump from meagre six kilogram to 14 kilogram in 2004-05.
According to United States Department of Agriculture (USDA), the estimate for MY 2004-05 imports has been lowered to 0.8 million bales on improved domestic production. Most imports will be limited to extra-long staple and specialty cotton.
Though, import volumes will depend on the relative price of Indian vis-à-vis international cotton, expected affordable prices and the improved quality of local cotton are likely to limit cotton imports during the forthcoming season.
Exports for MY 2004-2005 have been pegged to 0.8 million bales as India will export some cotton to its neighboring markets on the ground of competitive prices. |
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