President of the North India Cotton Processing Association, Rakesh Rathi said that every year farmers finish the harvesting of cotton by March and sowing starts during the first week of April; while this year the harvest was delayed until May and sowing would be done only in June.
Talking about the reasons for the delay in the production-to-procurement cycle, Rathi said that the prolonged winter season and the non-declaration of MSP for cotton were the major contributing factors.
Rathi added that the delay in sowing was likely to affect cotton stocks.
According to the Cotton Advisory Board, 25.1 million bales of cotton should be produced by October 1, 2012. The cotton is now expected to be ready only by the end of October.
Spinning mill owner Surinder Kumar said that the delay will push up the price of yarn. He said that almost every year the price of yarn increases due to reasons aplenty, ultimately decreasing the chances of expanding his business because of the need for more investment. This year is no different.
Yarn trader Ankur Jain said that while more expensive chemicals, dyes and labour have resulted in price pressures, delayed sowing of cotton could actually be the major reason for increase in yarn prices.
Trend in yarn prices
December 2009 INR128/kg
January 2010 INR180/kg
December 2010 INR260/kg
January 2011 INR270/kg