The domestic cotton prices are higher than the minimum support price (MSP) in many parts of the country, which means Cotton Corporation of India (CCI) will have to buy cotton at higher prices this year.
The prices are lower in some states due to 35 lakh bales of surplus stocks and weak export demand. However, prices are higher in north because of whitefly pest attack. Currently, the prices are the highest in Punjab at Rs 4,500 a quintal, while it is Rs 4,400 in Gujarat and Rs 4,200 in Maharashtra and Telangana.
However, this year government will procure only 20 to 25 lakh bales at the support price against 87 lakh bales last year, CMD of CCI, BK Mishra said.
The corporation has so far purchased 3,000 to 4,000 bales in Telangana and Andhra Pradesh and procurement would continue mainly in these two states and partially in Maharashtra.
CCI has opened 84 centres in Telangana and 25 centres in Andhra Pradesh and targets to set up a total 43 centres there and 50 centres in Maharashtra. The corporation is planning to open around 300 procurement centres across the country, mainly in the cotton belts of Telangana, Andhra Pradesh and Maharashtra.
Meanwhile, to protect the growers interest, the center held a discussion on the issue yesterday. The government has already fixed the minimum support price (MSP) at Rs 4,100 per quintal for long staple cotton and Rs 3,800 per quintal for medium staple cotton for the 2015-16 marketing year.
Minister of state for agriculture, MohanBhai Kalyanjibhai Kundariya said that all cotton-growing states are demanding increase in MSP and that the matter would be taken up at a higher level. With some farmers also demanding bonus, Kundariya said the state governments are free to announce it. CCI has also been asked to open procurement centres at the earliest at places where prices have fallen below the MSP, he added.