Cotton prices rise in South India amid strong garment demand and global supply dynamics

Cotton candy prices settled slightly lower at Rs 54,320, down 0.22 per cent, driven by projections of rising global cotton production for the 2024-25 season. Global production is expected to increase by 1.2 million bales to 117.4 million, with India and Argentina contributing significantly.

Despite this, India’s primary cotton-producing states-Punjab, Haryana, and Rajasthan, reported a sharp 43 per cent decline in kapas (unginned cotton) arrivals until November 30 compared to last year. Farmers are holding back produce in anticipation of better prices, creating raw material shortages for ginners and spinners.

South India cotton yarn prices rose due to strong demand from garment industries and exports. The Cotton Association of India (CAI) maintained its consumption estimate at 313 lakh bales (170 kg each) for the season, while imports are projected to rise to 25 lakh bales from last year’s 15.20 lakh bales. By November 30, 9 lakh bales had already arrived at Indian ports.

US cotton production forecasts increased to 14.3 million bales, adding to global supply. Immediate price support for cotton candy is seen at Rs 54,160, with resistance around Rs 54,540. Closing stocks in India are projected to decline to 26.44 lakh bales by September 2025.