Duty-free cotton imports to more than double by December 2025

Attracted by the appeal of less expensive Brazilian cotton, India's duty-free cotton imports are likely to more than double by December 2025. This growth is a direct result of two key factors: government policy and favorable global market conditions. The government has extended import duty exemption on cotton until December 31, 2025. This move makes imported cotton about 11 per cent cheaper for Indian textile companies, giving them a significant cost advantage.

Additionally, Brazil's bumper new crop, projected to be 23.5 million bales, allows its exporters to offer cotton at 4-6 cents per pound cheaper than US cotton. This further reduces costs for Indian buyers. Imports have already hit 3.3 million bales (170 kg each) by the end of July 2025. If global cotton prices remain low, this number could rise to 7 million bales by the end of the season.

The ICE cotton contract for October 2025 delivery is around 65 US cents per pound. The December contract is currently at 66.54 cents, but is likely to lower to 63 cents, which would put downward pressure on the global market.

If the December price falls to 63 cents, Indian mills could import Brazilian cotton for 71-72 cents per pound (including expenses). This translates to approximately Rs 49,000-50,000 per candy (356 kg), a very competitive price.