Would cotton a Boom Again for the seed industry in 2017 ?
Raja Vadlamani: Head of Supply Chain-Asia at Seedworks International Pvt. Ltd.
With the cotton prices stabilized around 20000 a bale and kapas at 50+ a kg(35-40 in 2014-15), cotton has become lucrative to the farmers to some extent now . Although there is significant reduction in areas , The All India productivity has been all time high this year at 568 kgs per Hectare since 2007 (Although it is quite low in a global perceptive with ranking of 30 th position).
Lower realization since 2014 prompted farmers to opt out of cotton crop, thereby reducing the area by over 10 per cent for the year 2016 in India.The decline in area is almost by 18% when compared to 2014-15. As per the estimates by international cotton body, global cotton prices are likely to remain firm amid tight demand-supply condition. And also On the international demand-supply front, the International Cotton Advisory Committee (ICAC) has predicted consumption outpacing the production thereby leaving less room for a bearish trend in cotton prices in 2017.
However Factors that could also be expected to weigh on prices include the strength of the U.S. dollar and an emergent outlook for the upcoming 2017/18 season that indicates there will be a meaningful increase in planted acreage.
If this positive sentiment continues,and the area under cotton bounce back to 2014-15 figures there could be an upside slide in the cotton Hybrid seed market by 8-10 million packets that the seed industry can aspire on.
Wish All stake holders of cotton a grand Cotton Year ahead.
(While the information contained in this post has been compiled with all due care, it does not warrant or represent that the information is free from errors or omission, or that it is exhaustive.)