MCX Cotton Oct futures tank more than 1.2% on Thursday mainly on profit booking as recent rains in the cotton growing states may improve production in the country. Good demand for new season cotton and reports of good exports demand for Indian cotton from the Asian countries.

According to the first advance estimates for 2017-18 released by the government, India's 2017-18 (Jul-Jun) cotton output is pegged at 322.7 lakh bales (1 bale = 170 kg), down 2.5% from 330.9 lakh bales in 2016-17.

Outlook

Cotton futures are expected trade sideways on weak international prices but reports of lower than expected crop size, cci procurement and improved exports demand for Indian cotton may support prices. Expectation of good production and carryover stocks may keep prices steady during the arrival seasons.

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