MCX Cotton Nov futures corrected on Tuesday on fresh selling initiated by the market participants at higher levels. Prices have jumped higher in the previous session as Gujarat government has announced a bonus of 500 per quintal over and above the minimum support price of 4,020. The Cotton Corporation of India is set to open its procurement centers in major cotton-growing states as it is believed that the prices may decrease below the MSP during the peak arrival season.

Outlook

Cotton futures are expected trade sideways on reports of improved arrivals but higher bonus declared by the Gujarat government, lower than expected crop size, cci procurement and improved exports demand for Indian cotton may support prices However, expectation of improved production and carryover stocks may pressurize prices.

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