With the fall in cotton prices which is slipping below the minimum support price (MSP) of the government, the state-owned Cotton Corporation of India (CCI) will procure cotton worth Rs. 12,000 crore this season.
CCI which currently has an inventory of 800,000 bales (of 170 kg each) of cotton is expected to purchase six million bales from states like Maharashtra, Andhra Pradesh, Telangana and Gujarat.
“Funds would be garnered from a consortium of 14 banks led by Bank of Baroda, Mr. BK Mishra, CMD of CCI said, while speaking at a cotton conference in Mumbai and added that till date CCI has bought 800,000 bales of cotton.
For the 2014-15 season, the government has fixed an MSP of Rs 3,750 per quintal for medium staple cotton and Rs 4,050 for long staple cotton and current market prices of cotton have gone down below the MSP.
Led by a marginal decline in production in Gujarat, Cotton Association of India (CAI) has estimated India’s 2014-15 season cotton output at 40.55 million as against 40.72 bales in the 2013-14 season.
