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Cotton commodity in india demand and supply
1. COTTON
Cotton is a soft fiber, grows around the seeds of the
cotton plant
It is the basic resource for thousands of consumer
and industrial products
The biggest cultivators of cotton are America, India,
China, Egypt, Pakistan, Sudan and Eastern Europe
US have a considerable share in world exports
India and China both fall short of their domestic
requirement and are net importers
2. PRICE TRADE OF COTTON
•Cotton prices fell across the
board on domestic and
international markets
•As demand remains
extremely weak amid large
fiber and yarn inventories
•Correction in cotton prices
has done
•Highest Price 245 Cents/lb
•Lowest price 145 Cents/lb
Source: Http://www.cottoninc.com
4. Demand
(Total Demand 24.6m tonnes, Reduced by over 400,000 tonnes)
Major factors of low Demand:
Significant fall of Cotton Demand in China, accounts 30% of Global
Cotton
(Around a drop of 17% in the month of May 2011)
Buyers’ future expectation
(Waiting for new crop to come in the market)
Substitution Effect
(Result of rise cotton price, mills substituting cotton with
-synthetic fibers,
-notably polyester
-and viscose (rayon))
The rapid rise and decline in cotton prices since September 2010, made
cotton storage companies suffer great losses
6. Supply
(Total Supply around 24.35m tonnes, 10.7% increase)
Major factors affected Supply:
Driven to a significant degree by the surging cotton prices
• World Cotton Production: 26.8 Millions of metric tons
• World Cotton Exports: 8.3 Millions of metric tons
Production increased by between 9.6% and 13% as the result of
increased production in key countries
Improved seasonal conditions
Higher plantings
7. CONCLUSION
Cotton plays a significant role among the most useful
commodities
Its expected, price of Cotton will further fall down
Cotton and cotton textile industries are central to the economic
growth of both developed and developing countries
It is the raw material of wealth, industrialization and
development