Global buyers rush to buy cheaper cotton in India

NEW DELHI: Cotton buyers from across the globe are rushing to India to get a better bargain as prices here are 5 per cent lower than other countries, says a report.

"Indian cotton is currently very competitive in the international market, about 5 per cent cheaper vis-a-vis comparable cotton from other origins," the US Department of Agriculture (USDA)said quoting industry sources in the report.

So far, a significant portion of the arrivals have been picked up by exporters, it said, adding that going forward prices are likely to gain further on strong export demand.

According to trade data, Indian cotton is quoting at 71.5 cents per pound (including logistic cost) now against international Cotlook rates of 75.10 cents pound.

"India has become an attractive destination for buyers from Indonesia, Bangladesh and China mainly due to limited cotton supply in the global market and comparatively strong international prices," an official with the Confederation of Indian Textile Indu stry said.

USDA said: There has been a big spurt in export registrations for the new crop since October as India shipped 19.2 lakh bales of cotton between August and mid-November, compared with 3.25 lakh bales in the year ago period.

It further said, "Strong international cotton prices have improved the export prospects for Indian cotton. In the 2009-10 season (October-September), exports are likely to touch 67 lakh bales assuming no government interventions on the current export pol icy for cotton." - PTI