India Govt bans cotton exports on declining production

New Delhi, Mar 5 (PTI) The Indian government today banned the export of cotton amid fears that its prices will shoot up on account of declining production in the current season. "Export of cotton has been prohibited till further orders," the Directorate General of Foreign Trade (DGFT) said in a notification. Exports against registration certificates already issued will not be allowed either, it added. A US Department of Agriculture (USDA) report has lowered India's cotton production estimates by about 750,000 bales to 34.25 million bales during the current 2011-12 marketing year (October-September). One bale contains 170 kg of cotton. In 2010-11, India's cotton production was 33 million bales. The forecast has been downsized due to an estimated lower production in the western state of Maharashtra, where weather conditions have been less than favourable for the crop's growth. As of January 15, arrivals stood at 13.52 million bales, as against 16.12 million bales in the year-ago period. State-owned Cotton Corporation of India has said that cotton exporters and domestic mills are making brisk purchases to meet their immediate as well as lean season requirement of the fibre amid concerns of a production fall and expectations of a pick-up in demand from the yarn industry. A rise in demand for yarn and reports of lower production are compelling exporters and domestic players to hike their purchases. India, the world's second-largest cotton producer, has already exported 8.5 million bales as against 7.0 billion bales last year. Textile mills consumption estimate has been revised up to 21.6 million bales for the current season from 21 million bales. PTI