India's cotton exports in 2011/12 could fall from the 6.5 million bales approved the previous year as poor rains reduce the amount of land sown with the crop in the world's second-largest producer and exporter. Initially the country's cotton acreage was expected to rise 15 percent in 2011/12 on record high prices, but scant rainfall in key growing areas may prompt farmers to go for other crops like corn and soybean and even trim per hectare yield of cotton.
India, Asia's largest cotton exporter, supplies the fibre to China, the world's biggest consumer. Its exports in 2010/11 helped to cool international prices in a year when adverse weather trimmed crops in China, Pakistan and Bangladesh. Total world exports were about 36 million bales in 2010/11, according to the US-based International Cotton Advisory Committee (ICAC) with global production at 114 million bales.
India's western states of Gujarat and Maharashtra and southern Andhra Pradesh accounted for over 75 percent of the country's total production in the cotton marketing year that began in October and all three states have received very poor rainfall in June, data from the weather bureau showed. Ahead of cotton sowing, a sharp rise in acreage was expected because of high returns on cotton and a forecast of near normal monsoon rains, raising concerns other crops might be squeezed out.
But poor rainfall in June derailed sowing plans as more than half of the cotton area in these three states is rain-fed. "I don't think the area will rise this year. Soil moisture level is very low. It is not allowing farmers to sow any crop in Gujarat," said a former president of the Cotton Association of India, who declined to be named.
"If we didn't get enough rains this week, chances are the area may even go down." Indian farmers have cultivated cotton on 3.517 million hectares as on July 1, down 22 percent compared to the sowing done by this time last year. In the 2010/11 cotton year, the total area sown hit a record 11.16 million hectares.
Patchy rains over the western region could hit prospects for cotton, Farm Secretary P.K. Basu said on Monday. "Gujarat will have to be watched carefully. Cotton output may be affected. Let's see. It is a little early", Basu said, adding a clearer picture would emerge after mid-July. Different parts of Gujarat, the biggest producer, have so far received 77 to 88 percent lower than normal rains in the current monsoon season which began on June 1.
"There is a decline in cotton planting in the initial stage because of a delay in rains but it is expected to pick up in July," said M.V. Parmar, deputy director (Cotton), Gujarat state farm department. The Cotton Advisory Board estimates the country may have produced a record 31.2 million bales in 2010/11, lower than the previous estimate of 32.9 million bales, but still 5.8 percent higher than the previous year.
"It (rainfall) should come in a week. If it doesn't, then farmers who have done sowing, may have to do resowing," said Dharmesh Lakhani, a trader and exporter based in western Gujarat state. The government has allowed exports of 6.5 million bales in 2010/11 year after demand for the fibre rose because of a bad crop in Pakistan and China, the world's leading consumers.
"Cotton is a longer duration crop compared to corn, soybean and bajara (pearl millet) and it requires more water than these crops. So obviously farmers will think about these crops," said a senior official at Maharashtra's farm deparReuters Cotton prices in India touched a record high of 61,700 rupees per candy of 356 per kilogramm (kg) on March 30, boosted by a rally in the world market, but since then have fallen over 40 percent.
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