India, the second-biggest cotton producer and exporter, may boost its limit on shipments as output surges to a record next year, according to a growers association.
Production will gain to 34.5 million bales, the highest ever, Nayan Mirani, vice president of Cotton Association of India, representing 450 growers, ginners and traders across the nation, said in an interview in Lubbock, Texas. This year’s crop is estimated at 29.5 million bales, according to India’s Cotton Advisory Board’s August estimate.
“There is a possibility the government will increase the export limit at the next review meeting in November,” Mirani said.
India said it would limit cotton exports to 5.5 million bales in the year beginning Oct. 1 in a bid to meet domestic demand. A “prohibitive” duty will be imposed on shipments above that level, Commerce Secretary Rahul Khullar said on Sept. 4. Textile Secretary Rita Menon said on Sept. 14 that the country plans to delay registration of export contracts by two weeks until Oct. 1
Cotton prices have surged 61 percent in the past year as textile mills stepped up buying amid falling inventories. The fiber is the best performing commodity in the last 12 months among the 26 tracked by the UBS Bloomberg CMCI Index.
Futures for December delivery gained 1.42 cents, or 1.4 percent, to settle at $1.0079 a pound on ICE Futures U.S. Earlier, the price touched $1.0237, the highest level for a most-active contract since June 1995.
An Indian bale weighs 170 kilograms (375 pounds).