Industrial Cluster: Cotton Association Of India (CAI) Announced The Reduction Of Cotton Planting Area

A report released by the Indian Cotton Institute (CAI) shows that India's cotton output in 2023/24 will hit a 15 year record low of 29.41 million bales. It is estimated that India's cotton output in 2024/25 may not be particularly ideal, because the cotton planting amount is expected to decline by nearly 10% due to the decline in unit yield and low cotton prices.

According to the data released by the Indian government, the cotton planting area of India in the summer of 2023 will be about 12.38 million hectares, more than 3% less than the previous year. The cotton year in India starts in October of each year and ends in September of the next year.

Atul Ganatra, Chairman of CAI, said at the annual meeting of the organization: "The cotton planting area in 2023/24 has decreased by 18%. I am worried that if the cotton planting area in 2024/25 is further reduced, the cotton yield may further decline."

According to the latest data released by CAI, India's cotton production in 2023/24 is expected to decline by 8% to 29.4 million bales (170 kg for one bale) compared with the previous year, which is the lowest level in 15 years.

Atul Ganatra said that the biggest challenge facing the cotton industry in the country is how to increase production. The cotton planting area of India accounts for 38% of the total cotton planting area of the world (33 million hectares), about 12.5 million hectares.

India's cotton lint yield is only 396 kg per hectare (about 2.22 bales), more than 40% lower than the global average cotton lint yield of 675 kg per hectare.

"The main reason for the decline in cotton production is that our transgenic cotton seed technology is very old. We now need new cotton seeds. Climate change and El Ni ñ o effect have also greatly damaged Indian cotton, because 73% of cotton growing areas are dry fields. In addition, pests such as pink cotton bollworm are also affecting the yield."

In 2013/14, India's cotton lint yield reached a high of 572kg/ha, but since then, due to the lack of technological upgrading, the country's cotton yield has declined by nearly 30%.

According to the data released by the Indian Cotton Association, if the country's textile industry runs at full capacity, it will need about 41.4 million bales of cotton every year, and India's domestic cotton output has dropped to about 29.4 million bales. The decline in Indian cotton production has hurt domestic textile mills, making them unable to operate at 100% capacity all year round.

Atul Ganatra said: "India's cotton import tariff is 11%, and textile mills cannot import cotton, so they cannot operate at full capacity. Due to the favorable policy environment and subsidies from state governments, many Indian textile mills will increase their annual production capacity by 1.5 to 2 million spindles. If this trend continues, India's annual cotton consumption will increase from 41.4 million bales to 45 million bales. If we cannot increase cotton production or If tariffs are not abolished, it will bring disaster. "

He said that due to the unsatisfactory rainfall in 2023, the cotton output will decline by about 15-20%, which will bring double losses to farmers. One is the decline of cotton yield, and the other is that the cotton price is still lower than the minimum government support price (MSP).