Oct. 21 (Bloomberg) -- Cotton harvest in India, the world’s second-largest producer, is poised to reach a record this year as the best rains in six years boost yields.
Output may jump 6.7 percent to 38.1 million bales of 170 kilograms (375 pounds) each in the crop year that began on Oct. 1 from 37.5 million bales estimated in September and 35.7 million bales in 2012-2013, the Cotton Association of India said in an e-mailed statement today.
A record Indian crop may increase exportable surplus, adding to global supplies and capping a 11 percent gain in prices in New York this year. World reserves are estimated to expand to 20.3 million metric tons by July 31 from 19.22 million tons estimated a month before, the International Cotton Advisory Committee said on Oct. 10.
“The available moisture is likely to help increase the yields and result in a larger than estimated crop,” said Dhiren Sheth, president of the association.
The monsoon, which accounts for more than 70 percent of the country’s annual rainfall, was the highest since 2007 during the June-September period, according to the India Meteorological Department. The showers eased a drought that cut production the previous year.
“Exports may be similar to what we saw last year,” said Sheth. “We have already contracted to export 1.5 million bales of the new crop.”
Shipments totaled 9.8 million bales in 2012-2013, mainly to China, according to the association. Surplus is pegged at 13.75 million bales for this year, it said. Domestic consumption may climb to 26 million bales from 24.7 million bales last season, while imports are seen dropping to 1.2 million bales from 1.6 million bales, it said.
Cotton for December delivery was little changed at 83.20 cents a pound on ICE Futures U.S. in New York at 2:09 p.m in Mumbai. Futures tumbled 18 percent last year, extending a 37 drop in 2011. The contract for delivery in April on the National Commodity & Derivatives Exchange Ltd. in Mumbai was unchanged at 994.50 rupees ($16.2) per 20 kilograms.
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