Cotton Prices Continued To Rise For Six Months In India

March, India commodity exchange (MCX) Cotton price It rose for six consecutive months, or about 2.3%, and rose about 15% in the first quarter of 2013. Demand from China is expected to increase and the number of domestic market arrivals is reduced. These factors provide support for prices. However, as investors worried about the problem of cotton sales in India and China, the two largest cotton producing countries in the world, prices were under pressure until the end of March. However, the India government has not put in stock, and China's investment is lower than expected. This has led to a rise in cotton prices again.

MCX cotton contract rose nearly 12% from the February low in April, and the transaction price now is about 19000 rupees / pack (1 =170 kg). In the international market, cotton prices hit a 11 month high in March, reaching 93.93 cents / pound, and now the price is about 88.20 cents / pound.

The domestic market has seen a decline in the supply of cotton and the rise in prices, which calls for the government to encourage India's Cotton Corp (CCI) and the national agricultural cooperative market alliance (NAFED) to domestic market. Spin The factory put in cotton stocks. However, the agriculture department is opposed to this because releasing inventory may drag down cotton prices.

According to the latest estimates of the Cotton Advisory Committee (CAB), 2012-13 years (October -9) Cotton yield The 33 million package is 7% less than the estimated 35 million 500 thousand package last year. Analysts say cotton prices may go up because of strong domestic demand and relatively low supply. In addition, the strong international market may also provide support for domestic cotton prices.

In the short term, due to the good export demand expected from Pakistan, Bangladesh and China in the coming weeks, cotton prices in the domestic market are expected to come out of the recent downturn and start to strengthen. In addition, the reduction in market arrivals will also lead to further price increases. In addition, China's inventory is lower than expected. cotton The reduction of planting area to the minimum area of four years will also further support the strengthening of fiber prices. However, global market sentiment may inhibit price rises.

Technically speaking, the important supporting position of MCX cotton price is about 18500 rupees / pack (170 kg / bag). The higher resistance level may be 19500 rupees / bags. If prices continue to be above 19500 rupees / bags, the market may see 20100-21000 rupees / bags. NCDEX the strong support for the April 2013 cotton contract is about 850 rupees /20kg, with a resistance level of 1021 rupees /20 kg.