Cotton MCX is getting support at 20624 and below same could see a test of 20505 level, And resistance is now likely to be seen at 20777, a move above could see prices testing 20834.
Cotton prices ended with small gains on short covering after prices dropped due to reports of rising supplies from major producing belts.
Further, weak domestic as well as export demand also weighed on cotton prices.
According to 3rd advance estimates for 2016/17, higher productivity of Cotton has resulted into higher production of 32.51 million bales (of 170 kg each) as compared to 30.01 million bales during 2015-16.
According to CCI, about 302 lakh bales of cotton arrivals were recorded till 4th May in the country. The domestic cotton arrivals in April are higher by 49% on year at 2.64 lakh tonnes (lt) compared to 1.77 lt last year, as per data.
As per USDA, about 21% of plantings have been completed in 15 major cotton-producing states across the US in the week to May 7, up from 14% the previous week and compared with five-year average of 25%.
The International Cotton Advisory Committee (ICAC) has projected that India’s cotton exports will grow 3 per cent to 990,000 tonnes in the current year, with production likely to rise by 2 per cent to 5.9 million tonnes.
World cotton trade is estimated to expand by 3 per cent to 8 million tonnes in 2017-18, with China’s import volume set to grow by 11 per cent to 1.1 million tonnes for the year.
ICAC cites the growth in China’s imports to its surging mill use, which continues to outpace its production. — Neal Bhai Reports