Our Bureau Mumbai, March 12
Cotton Association of India (CAI) has urged the Cotton Corporation of India (CCI) not to use its inventory for controlling prices in the market.
“The CCI should not support the private textile industry alone. It should sell cotton to any entity – be it a mill, trader, exporter or foreign buyer, whoever offers the highest price for its cotton on a given day,” said Dhiren N. Sheth, President, CAI.
Last week, the Cotton Textile Export Promotion Council (Texprocil) requested the Government to direct CCI to offload a portion of their stock to bring down domestic prices which breached international prices. Manikam Ramaswami, Chairman, Texprocil said CCI and Nafed purchased 20 lakh bales of cotton in three months ended January, at minimum support price fixed by the Government.
“The Government bodies have sold just 2-3 lakh bales in the last few months resulting in an artificial shortage of cotton supply. Taking cues from these agencies, private traders have also starting hoarding.
REDUCE EXCHEQUER LOSS
Despite surplus cotton production estimate, India has been forced to look to other countries to meet its demand,” he had said. CCI should reduce the loss to the exchequer and, therefore, should sell cotton to the highest bidder. It needs to decide on a sales policy keeping in view the massive loss suffered due to the defaults committed by several of its clients a few years ago, he said.
Cotton prices in the domestic markets have risen 10-12 per cent since the season started in October, while international prices have gone up by 20 per cent in the same period, said a CAI press release on Tuesday. The prices of cotton are increasing due to good demand for yarn in the last few months and the mills have made a good profit, the statement said. (Source: The Hindu Businessline)