There is a phase of boom in cotton prices. Cotton prices on Multi Commodity Exchange (MCX) are currently at the peak of the last 24 months. American Cotton (ICE Cotton) is also at record prices since May 2019. This will also affect the common people as everyone uses cotton. With this, not only clothes are made but bedsheets, towels are also made which is used by everyone. At this time, cotton is trading close to 20 thousand on MCX. Earlier, in January last year, the prices of cotton were around this. The biggest reason for the rise in cotton is the circumstances arising out of the corona epidemic.
News of vaccine increases cotton sales
With the news of the arrival of the Corona vaccine, everyone hopes that economic recovery is possible soon. In such a situation, the demand for ice cotton as a natural fiber has increased rapidly and at this time it is at the peak of the last year and a half. In May last year, it was trading at 73 cents and at this time its prices are still close to 73 cents. There are signs of it going ahead soon.
According to Kedia Commodity Director Ajay Kedia, its price cannot be expected to decline right now due to increasing demand. It can remain above 70 cents even further. Its demand is increasing globally. Apart from this, its price on MCX is expected to remain above 20 thousand. In such a situation, there is still a chance for investors to make a profit from it.
Production is expected to fall
Cotton crop has been affected due to heavy rains this year. The Cotton Association of India (CAI) has estimated production of 356 lakh bales in the season 2020-21 (starting from 1 October 2020) as against 360 lakh bales in the previous season 2019-20. A bell holds 170 kg.
The Cotton Corporation of India (CCI) has increased its procurement and is now purchasing it from the government’s minimum support price (MSP) at Rs 5825 per quintal from 390 centers in its 450 centers. The government has set its MSP of Rs 5850 per quintal for raw cotton (cotton) for this session (October 2020 to September 2021).
According to Ajay Kedia, Indian cotton is currently being sold at the rate of 40 thousand per candy, while other cotton producers worldwide are selling their candy at the rate of 41 thousand. Because of this, Indian cotton has got a price advantage.
Demand suddenly increased after the lockdown opened
According to Anuj Gupta, deputy vice president (energy and currency), Angel Broking, the main reason for the rise in cotton is its increasing demand. China is doing aggressive shopping for it. Apart from this, the textile business has been weak in the last six-seven months due to the corona epidemic or you can say that people have not bought clothes. Now as the market is growing and people are increasing their purchases with the expectation of the vaccine coming, its demand has suddenly increased. According to Anuj Gupta, within the next few months, its price can also show a level of 22 thousand per vine.
Source: www.financialexpress.com