In an early and a big boost to the cotton trade in the state procurement markets, its price has crossed the psychological mark of Rs. 5,000, leaving the behind a disappointing last season.
Cotton bales were auctioned at Rs. 5,410 per quintal at the Breta cotton market of Mansa district on September 28, whereas not a single bale was auctioned for above Rs. 5,000 in the 2012-13 season as stagnation in the prices was witnessed.
The cotton prices had crossed the Rs. 5,000-mark in the 2010-11 procurement season for the first time in the history of the cotton trade in Punjab. Prices had touched a high of `8,000 same year. The prices remained average in 2010-12, even as they crossed the Rs. 5,000-mark that season too.
Farmers' morale was hit in the 2012-13 season when majority of cotton bales were procured below Rs. 4,500.
The initial trends in the cotton markets are encouraging this year. Against the 74,000 quintal cotton procured till date last year, nearly 1.38 quintal cotton has been procured this year.
Cotton traders are excepting that the total arrival this season will cross last year's figure of 83 lakh quintal. Also, according to the agricultural department, cotton has been cultivated on 5.05 lakh hectare area in the state against 4.48 lakh hectare last season.
"The cotton MSP in Punjab varies from Rs. 3,700 to Rs. 4,000 depending upon the length of cotton. This year, farmers are not coming to our laboratory to measure the length of their cotton fibers as there are already getting price above MSP in the open market," said Pirthi Singh, a lab attendant in the office of the cotton officer, Bathinda.
The prices of cotton had remained below Rs. 5,000 last year but it has already crossed the mark in the initial weeks this season, added Pirthi Singh.
"Initially, there were some doubts in the minds of traders and farmers. But now the mood is very much positive. It is expected that initial trends will be continue in the coming months," said Ashok Kapoor, a trader and former president of the Cotton Association of India. Asked the reasons behind his high hopes, Kapoor said, "Some of the cotton mills in the Malwa region have enhanced their capacity so they are expected to procure more cotton than last year. It will surely create a demand in the market and farmers will be benefitted."
"Secondly, spinning and ginning mills are getting good value for their product in domestic and international market, so they will not mind paying a good price to farmers," said Kapoor.
"We suffered losses last year due to low prices. I hope the prices will be maintained in the peak season of arrival so that farmers can make up for the loss," said Balwinder Singh, a cotton farmer.