MCX Cotton Market Update
Cotton on MCX settled flat despite of pickup in demand from domestic mills in the spot market. Though, some gains were capped as US Department of Agriculture (USDA) has projected US cotton production for 2016 at 16.5 million bales, an increase of 2% above the 2015 cotton crop. Export demand of fiber has been subdued so far this year due to lower export to Pakistan amid prevailing liquidity crunch in physical market which has led to delay in shipment forcing international buyers to look for other alternatives. Also, US Department of Agriculture has revised its consumption forecast downwardly for India to 23.75 million bales of 480 lb each (30.7 million bales of 170 kg) from 24 million bales (30.13 million bales).
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All India arrivals were noted to be around 160,000 bales higher from 150,000 bales previous day. World cotton stocks are forecast to decline 8 % (7.7 million bales) in 2016/17 to 89.1 million bales, the lowest in 5 years.
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