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US 2020-21 cotton exports highest in 15 yearsSpurred by record global imports, US cotton exports in 2020-21 were the highest in 15 years at 16.4 million bales. China eclipsed Vietnam as the largest destination for US cotton for the first time in 6 years at more than 5 million bales, accounting for roughly one-third of US shipments, according to the US department of agriculture (USDA).However, US exports to eight of its ten largest markets were down from the previous year, the foreign agriculture service (FAS) of the USDA said in its September 2021 report on ‘Cotton: World Markets and Trade’.*“Record US shipments through December boosted total exports as early season shipments were buoyed by the highest beginning stocks in 12 years. Shipments were strong, especially to China, despite US 2020-21 production falling 5.3 million bales from the previous year,” the report said.US exports to China were the largest in 8 years with demand for US cotton mostly led by China’s State Reserve. US cotton was estimated to account for almost 90 per cent of State Reserve imports and nearly one-half of China’s total imports in 2020-21. Instead of sourcing from Brazil, the primary supplier in the previous two marketing years, the State Reserve returned to the United States, in part facilitated by the Phase One Agreement.Relative prices (i.e., China cotton prices compared with US cotton prices) also played a role. China’s spot price (CC3128B) was significantly higher than imported prices (US origin) in 2020-21 compared with the previous year. Although higher domestic prices prevented the Reserve from purchasing domestic cotton, imports were an especially attractive option compared with the previous year. Imported US cotton averaged 10 cents higher than domestic China cotton in 2019-20, but in 2020-21 was approximately 8 cents cheaper (on average).Higher prices in China relative to international were likely due to: (1) higher agricultural prices in China (e.g., corn and wheat), (2) quality issues with China’s 2020-21 cotton crop, and (3) the yuan appreciating roughly 10 per cent against the U.S. dollar.While 2020-21 US cotton exports were the largest in 15 years, it was also a record year for global imports. Bangladesh, Vietnam, Pakistan, and Turkey, rounding out the top 5 largest global imports (China being the largest), were all estimated to have had record imports in 2020-21. Higher yarn prices and rising global demand for cotton products spurred imports and cotton consumption.Brazil and India helped supplant US exports in these respective markets; Brazil’s 2020-21 exports exceeded the previous year’s record by roughly 2 million bales, and India is projected to register its highest exports in 7 years.US 2021-22 exports are forecast down from the previous year at 15.5 million bales, despite a larger crop at 18.5 million bales, with both lower US carry-in and global imports more than offsetting, the FAS report said.China is once again forecast as the world’s largest importer at 10.0 million bales, but down more than 2.8 million from the previous year, it added.

 Rupee closed at 74.05 level, weakening by 21 paiseWeakness in rupee against dollar was seen. The rupee had started with gains today but during the trading day, the fall in the rupee deepened and the rupee reached a low of 27 August against the dollar.Sensex fall, 410 points fell below 60,000 markToday the closing took place with a fall in the stock market. Today, where the Sensex closed at the level of 59667.60 points with a gain of about 410.28 points. On the other hand, Nifty closed at the level of 17748.60 points down by 106.50 points.

SIMA to work with State govt. to promote cotton cultivationThe Southern India Mills’ Association (SIMA) will work with the State government to increase the area under cotton cultivation in Tamil Nadu, said Ravi Sam, chairman of Southern India Mills’ Association. Mr. Ravi Sam and association vice-chairman Durai Palanisamy told presspersons here on Monday that Tamil Nadu was once a major cotton producing State. Though it was a leading textile producer now, the industry purchased cotton from other States.With the removal of 1 % market committee cess on cotton, the Cotton Corporation of India(CCI) has expressed willingness to establish warehouses in the State. The first one will come up in Coimbatore and the Central Warehousing Corporation will handle it, said T. Rajkumar, chairman of Confederation of Indian Textile Industry. The CCI had nine lakh bales of cotton with it and if the industry wanted to purchase cotton from it, the CCI would move the cotton to the warehouses here. This would help in cost saving for the industry. With the Union government approving the Production Linked Incentive Scheme for textiles, 10 to 15 industries in the State were expected to invest approximately ₹300 crore each under the scheme.Works to commission a textile processing park proposed by SIMA at Cuddalore would be expedited. The association had developed a common infrastructure at Cuddalore with an investment of ₹96 crore, and two units had expressed willingness to put up plants immediately. The Union government would support establishing one mega textile park in each southern State. The Tamil Nadu government had expressed willingness to have three parks - at Dharmapuri, Thoothukudi, and Virudhunagar.Mr. Ravi Sam said the other focus areas of the Association were working with the Union government and urging it to sign free trade agreements with select countries soon. Further, the import duty on cotton should be removed and the hank yarn obligation should be reduced to 20 %, he said.

Government notifies textile PLI: 30-60% value add, introduces ‘Smart TextilesThe government on Monday notified the Rs 10,683 crore Production Linked Incentive (PLI) scheme for textiles that covers 10 technical textile products, 14 manmade fibre (MMF) products and 40 MMF apparel. The textiles ministry said that only those companies would be selected for the incentive under the programme which contribute 60% value addition in integrated fibre/yarn to fabric, garment & technical textiles and 30% in case of independent fabrics processing house.The scheme outlines two categories with different incentives based on minimum investment of Rs 300 crore and Rs 100 crore and covers products such as jackets, jerseys, trousers, overcoats, polyester fabric and nylon furnishing fabrics.Technical textiles include safety airbags, shade nets, bullet proof jackets, surgical sutures, Personal Protective Equipment for medical use and carbon fibre.The government has also included Smart Textiles embedded with active devices for medical, defence and special use in the list of products eligible for the benefits.Smart Textiles is a new generation niche product that is a combination of varieties of wearable materials embedded with electronics.“The description does not fit into any particular HSN Code at present. A suitable HSN Code at 8-digit need to be created afresh for this product,” the textiles ministry said.As per the notification, incentives under the scheme will be available for five years period i.e. during FY26 to FY30 on incremental turnover achieved during FY25 to FY29 with a budgetary outlay of Rs 10,683 crore.However, if a company is able to achieve the investment and performance targets one year early then, they will become eligible one-year in advance starting from FY25 to FY29.As per the notification, any person, which includes firm/company willing to invest a minimum Rs 300 crore in Plant, Machinery, Equipment and Civil Works (excluding land and administrative building cost) to produce products of the notified lines, will be eligible to participate but they would have to form a separate company under Companies Act, 2013, before commencement of investment under this scheme.“Thus, for getting incentive, both the conditions of minimum investment and minimum turnover should be met,” the ministry said.The companies which invest Rs 300 crore, are expected to achieve a required turnover of Rs 600 crore after a gestation period of two years and a 15% incentive will be provided on attaining the same. Incentive in the subsequent years will be provided on achieving a minimum additional incremental turnover of 25% over the immediate preceding year’s turnover up to year. However, the incentive will be reduced by 1% every year from the second year onward till the final year and would become 11% in the year 5.Only such sales will be counted, which are transacted through normal banking channel, according to the notification.Similarly, those who apply for the Rs 100 crore category, would have to achieve a turnover of Rs 200 crore and the benefits will start from 11% and end at 7% in the last year.

Clothing Is About to Get More Expensive With Cotton Prices at 9-Year HighsHigh cotton prices are shaking up futures markets, igniting a short squeeze in the New York exchange and signaling higher costs for makers of T-shirts and other apparel.Heavy rains are threatening crops in major U.S. growing regions including Texas and the Mississippi Delta, according to Maxar Technologies Inc.’ senior meteorologist Donald Keeney. The U.S. is the world’s biggest cotton exporter. At the same time, overseas shipments are flowing with demand rising in China, the top user, and buyers like Turkey and Pakistan are looking for product as well.Futures are on a tear, nearly touching $1 a pound, a level not seen since 2011. The higher prices mean that the costs to make clothing are on the rise, which retailers may try to pass to consumers. In the U.S. at least, that will be difficult, with discretionary spending constrained by the pandemic and stagnant wages, said Peter Egli, the Chicago-based director for Plexus Cotton Ltd. Higher clothing prices may curb demand.The rising futures are also catching some traders with substantial short positions on ICE U.S. exchange, pushing up prices even more. “This is a classic short squeeze,” said Egli. “The trade is short.”Cotton for December delivery rose as much as 4% to 99.86 cents a pound in New York, before paring gains. The commodity is up for a fifth session and has surged 48% in the past year amid projections for two straight world deficits through 2021-22.More gains could be in store with more large outstanding short positions in the market, according to O.A. Cleveland, a Mississippi State University economics professor emeritus, and consultant. Short mills should have fixed prices when futures dropped earlier this month, he said. Their short positions “continue to keep a fire burning under prices.”In the shorter term, shipping constraints are also helping cotton’s rally. The U.S. had a small crop last year, and “it is not easy to get cotton to mills in short order,” said Jon Devine, economist for North Carolina-based researcher Cotton Inc.China has been buying more American supplies recent weeks and the “raw-fiber equivalence of cotton estimated to be contained in U.S. apparel imports has been occurring at the highest rate since the 2010-11 price spike” when futures reached record highs, he said.

Rupee opens 4 paise stronger against dollarRupee opened strongly against the dollar in the foreign exchange market today. Today the rupee opened with a strength of 4 paise at Rs 73.80 against the dollar. At the same time, on Monday, the rupee closed at Rs 73.84 with a weakness of 15 paise against the dollar.Sensex opened at record high with a gain of 208 pointsToday the stock market opened with a record high. Today the BSE Sensex rose by about 208.01 points to open at a record level of 60285.89 points. On the other hand, the Nifty of NSE opened with a gain of 51.40 points at a record level of 17906.50 points.  

 *All India Weather Forecast for September 28, 2021**Weather systems made across the country*Cyclone Gulab has weakened into a deep depression over South Chhattisgarh and adjoining areas.The Deep Depression will move westwards and turn into a low pressure area over Maharashtra.The Monsoon Trough is passing through Jaisalmer, Kota, Sagar, center of deep depression and then moving eastwards across East Central Bay of Bengal.The Cyclonic Circulation lies over East-central and Northeast Bay of Bengal adjoining Myanmar Coast.Weather movement across the country during the last 24 hoursDuring the last 24 hours, heavy to very heavy rainfall occurred over Coastal Andhra Pradesh and Kerala.Light to moderate rain with isolated heavy falls occurred at isolated places over Lakshadweep, Telangana, Gujarat region and Madhya Pradesh.Light to moderate rain at isolated places over rest of Madhya Pradesh, southeast Rajasthan, Gangetic West Bengal, remaining parts of Odisha, Jharkhand, Chhattisgarh, Konkan & Goa, Karnataka, Andaman & Nicobar Islands and Uttarakhand, Jammu and Kashmir and Assam rained out.Light rain occurred over Uttarakhand, Uttar Pradesh, parts of Bihar, rest of Northeast India and South Interior Karnataka.*Probable weather activity during next 24 hours*During the next 24 hours, light to moderate rain with isolated heavy falls at isolated places over Telangana, South Chhattisgarh, Vidarbha, Marathwada, North Madhya Maharashtra, Konkan & Goa, Gujarat, Coastal Andhra Pradesh, North Interior Karnataka and Andaman & Nicobar Islands Might be possible.Light to moderate rain is possible over parts of Meghalaya, Sikkim, West Bengal, Kerala, Coastal Karnataka, Lakshadweep, East Rajasthan, Madhya Pradesh, Jharkhand, Uttarakhand, Uttar Pradesh and Bihar.*Light rain is possible over rest of Northeast India, Tamil Nadu and Jammu and Kashmir.*

PAKISTAN COTTON MARKET UPDATE**Upward trend persists on cotton market**The Spot Rate Committee of the Karachi Cotton Association on Monday increased the spot rate by RS 100 per maund and closed it at Rs 13300 per maund.**The Spot Rate Committee of the Karachi Cotton Association on Monday increased the spot rate by RS 100 per maund and closed it at Rs 13300 per maund. The rate of Polyester Fiber was increased by Rs 3 per Kg and was available at Rs 225 per kg.**The local cotton market on Monday remained bullish and trading volume remained a little bit low. Cotton Analyst Naseem Usman told Business Recorder that positive aspects of news of ending of trade war between China and America beginning to be seen in cotton markets of the world including Pakistan.**The rate of cotton in Sindh is in between Rs 12000 to Rs 13500 per maund and the rate of cotton in Punjab is in between Rs 13300 to Rs 13700 per maund.**The rate of the new crop of Phutti in Sindh was in between Rs 5400 to Rs 6000 per 40 Kg. The rate of Phutti in Punjab is in between Rs 5400 to Rs 6100 per 40 kg. The rate of Banola in Sindh is in between Rs 1700 to Rs 1800 per maund. The rate of Banola in Punjab is in between Rs 1700 to Rs 1850 per maund. The rate of cotton in Balochistan is in between Rs 13400-13700 per maund. The rate of Phutti in Balochistan is Rs 6200- 6700 per maund.*

*ICE COTTON SUMMARY**Cotton futures hit contract-high**ICE cotton futures gained for a fifth straight session on Monday, climbing as much as 4% to a contract-high as funds stepped up purchases and demand from China, the biggest natural fiber consumer, remained steady.**Earlier, the December contract jumped 4% to hit a contract-high of 99.86 cents per lb.**"You've probably got a good bit of fund buying, the volume is pretty heavy today," said Jim Nunn, owner of Tennessee-based cotton brokerage Nunn Cotton, adding buying from China was also a factor.**"These merchants have a lot of positions open with mills, so they are buying against those using December futures... the market is telling us that you need cotton right now."**On Thursday, the US Department of Agriculture's weekly export sales report showed net sales of 345,400 running bales for 2021/2022, were up 21% from the previous week, with increased buying primarily from China.**Nunn added cotton farmers were very happy with prices at these levels and that some grain farmers would "wish that they'd planted a little bit more cotton."**The December contract climbed for a fifth session in a row, its longest gaining streak since early August. Prices have risen around 5.7% so far this month, having gained in the previous three months as well.**Total futures market volume fell by 2,538 to 59,983 lots. Data showed total open interest rose 8,283 to 271,571 contracts in the previous session.*

Today evening, the rupee depreciated by 15 paise to close at Rs 73.85 against the dollar.Sensex closed flat, closed only 29 points higherToday the stock market closed sharply. Today, where the Sensex closed at the level of 60077.88 points with a gain of about 29.41 points. On the other hand, Nifty closed at the level of 17855.10 points with a gain of 1.90 points.  

Pak-China cooperation to revive cotton fields in PakistanPak-China cooperation to revive cotton fields in Pakistan, Gwadar Pro reported on Sunday.Last season, Pakistan harvested 5.6 million bales of cotton, which is the lowest point in the past 30 years.Meanwhile, Pak-China cotton-related cooperation is in full swing. “We are mixing the advantages of China cotton and Pakistan cotton to create new cotton varieties,” said Shahid Iqbal, PhD scholar of Cotton Research Institute in Henan, China, who has been working for a Pak-China cottonseed program in Henan for 4 years.This is one of the microcosms of the ongoing China-Pakistan cotton collaboration.“Last year, we had to import more than 50% of cotton,” said Muhammad Abdullah, executive director of Sapphire Fiber, one of the largest textile companies in Pakistan.He complained that low production and quality force the local industry to choose imports. “Presently, the domestic consumption of cotton is 14 million bales. However, Pakistan harvested 5.6 million bales of cotton in the last season only.” He added.Cotton production in Pakistan is in a vicious circle. According to the research of Central Cotton Research Institute (CCRI), low production of cotton lead to the low profitability of cotton planting. Cotton farmers turn to grow sugarcane in cotton-growing areas for better income. Sugarcane plants robbed water from cotton plants and humidified the whole area.The high humidity leads to more insects which are deadly to the cotton plants and farmers have no technology to deal with them.What makes it worse is the climate change in the past few years, which is also weakening cotton’s strength and staple elongation. Another quality problem is the impurity which is caused by 100% manual picking.As pickers picked the cotton, stored and transported it, contamination is entering in the cotton, which may causes spots on the final product. Kamran Razaq, cotton field supervisor of Sapphire Fiber pointed out that the impurity content of imported cotton is 4.5%, while the counterpart in Pakistan cotton is 8-9%, which is below the criteria of the textile mills.To break the vicious circle of low cotton production, higher quality seed is the top demand, which can also help in quality improvement.