Indian Cotton Exporters Up Purchase As Prices Weaken.

Indian cotton exporters have increased their buying tempo and are making brisk purchases as prices have weakened to around Rs. 35,500 a candy of 356 kg each on December 29 compared to Rs. 39,000-39,500 in first week of November 2011.

Speaking to fibre2fashion, Mr. Baldev Pujara, owner of the Coimbatore-based cotton broking house JG Pujara & Sons, said, “Exporters have been buying cotton from the market for the last 45 days, but they have now increased their tempo and are purchasing in bigger volumes.”

He said Louis Dreyfus Commodities, Olam International and Carlyle Major have been the top 3 multinationals that are buying cotton for exports. He named Bhadresh Trading, Ruchi Worldwide, Gill & Co. and Khimji Vishram and Sons as other trading houses that are buying cotton.

Talking about expected volume of exports this year, Mr. Pujara says, “By December-end, 2 million bales were already shipped out and the exporters had another 4-5 million bales on-hand, out of which around 2 million bales are due for shipment in January. In all, at least 8 million bales will be exported this year, then the Government will decide whether to allow further export or not. Currently cotton exports are under open general license (OGL).”

Informing about the factors that propel India’s cotton exports, he says, “Indian cotton is cheaper and hence, it is competitive on the price front. Secondly, cotton is available in large quantities this year, which includes all types of cotton and for all kinds of requirements.”

“America’s crop has damaged to a certain extent this year and the production is around 25-30 percent less than the volume expected earlier. So, a percentage of the North American market got passed on to India fueling the cotton exports form our country,” he adds.

Saurashtra Ginners Association President Mr. Bharat Vala also agrees that major exporters are buying cotton and names Jaydeep cotton, Bhadresh cotton and DM Lakhani as the export houses that are purchasing cotton.

Commenting on the main export destination, Mr. Vala says, “Our main export destination for 2012 is China. The northern neighbour will open its new quota after the New Year holidays i.e. after 20th January. So, the exporters who have sold or who have got contracts are buying now, and currently covering is going on.”

Source : fibre2fashion.com