Cotton Candy prices edged up by 0.09% to settle at 57,000, supported by the USDA's reduction in India's cotton production forecast for the 2024-25 season to 30.72 million bales due to crop damage from excessive rains and pest issues. Additionally, ending stocks are forecasted to drop to 12.38 million bales. Acreage under cotton is down by about 9%, but higher yields from timely rains are expected to offset this reduction. However, the upside remains limited due to moderate demand and weak export activity, particularly in Bangladesh.
India’s cotton exports for the 2023-24 crop year are estimated to reach 28 lakh bales, an 80% increase from the previous year’s 15.5 lakh bales, driven by demand from countries like Bangladesh and Vietnam. Cotton consumption is projected at 317 lakh bales for the year, with 291 lakh bales consumed by August end. Imports have risen to 16.4 lakh bales, up from 12.5 lakh bales in the previous year. In the U.S., lower cotton production, mill use, and exports for the 2024/25 season have been reported, primarily due to damage from Hurricane Helene. Global cotton production is expected to rise, with increases in China, Brazil, and Argentina offsetting reductions in the U.S. and Spain.
Technically, the market saw fresh buying as open interest increased by 0.77% to settle at 131 contracts. Support is at 56,810, and a drop below this level could lead to a test of 56,630. On the upside, resistance is at 57,180, and a move above this could push prices toward 57,370. The market remains sensitive to both domestic crop conditions and global demand trends.
