Cotton output at 370 lakh bales this year, exports may be flat

NEW DELHI: Cotton production is estimated to be 370-375 lakh bales in 2013-14 season, while the fibre's exports are likely to remain flat at 100 lakh bales this year, Textiles Minister K S Rao said today.

The Agriculture Ministry has pegged the cotton output at 353 lakh bales (of 170 kg each) for this season.

"This year cotton production is estimated to be 370 lakh bales or 375 lakh bales and our requirement is only about 270 lakh bales in the current cotton season, so there will be excess of cotton of 100 lakh bales which we have permitted under the Open General License (OGL) with registration," Rao said.

He was talking to reporters after chairing a conference of state ministers of textiles here.

In the last cotton season (October-September), the natural fibre production was around 340 lakh bales. The domestic consumption was 260 lakh bales and exports were at 100 lakh bales.

"We want to motivate cotton growers and suggest the best practices adopted by developed countries in the area of cotton production. In India, yield per acre of cotton is much less compared to developed countries and we want to do R&D in this regard," Rao said.

The CAB, which is under the Textiles Ministry, has not come out with its latest review on cotton for this season.

The Board, which usually meets every quarter to estimate cotton output, consumption, exports and imports, has not come with any review since April this year.

The increase in the natural fibre output in this year is likely to be on account of good monsoon mainly in cotton growing states and increase in acreage.

On the proposed Cotton Distribution Policy, Rao said, "This has been referred to a Group of Ministers (GoM) who are expected to meet in a couple of days."

The GoM comprises Agriculture Minister Sharad Pawar, Commerce Minister Anand Sharma and the Textiles Minister, among others.

Due to differences of opinion among key ministries, the Cabinet Committee on Economic Affairs (CCEA) had on September 12 deferred a decision on the cotton distribution policy that proposed a 10 per cent export duty on on cotton beyond a declared exportable surplus.

Currently, there is neither any export duty nor restriction on quantity of shipment of cotton after registering contracts with the Directorate General of Foreign Trade (DGFT).

Under the policy, the Textiles Ministry had recommended an export duty of 10 per cent ad valorem at freight on board (FOB) or Rs 10,000 per tonne, whichever is less, for all cotton exports exceeding the declared/revised exportable surplus.

India is the world's second-largest cotton producer and exporter. Of the country's total natural fibre exports, China accounts for about 75 per cent.