07 September 2022, Mumbai:
Cotton prices started sliding – SIMA hails intervention of Union Textile Minister.
The Indian cotton textile industry has been facing an unforeseen crisis from the beginning of the year especially from 1st April 2022 due to an abnormal increase in cotton price that was primarily caused by speculation of cotton trading under MCX and 11% import duty levied on cotton. The MCX cotton price has been costlier by 40% to 60% by 31st August 2022 when compared to the New York futures. The removal of the 11% import duty on cotton from 14th April 2022 to 31st October 2022, though gave a sigh of relief, it did not last long as the international and domestic cotton prices started coming down and creating a panic situation in the industry.
Realizing the urgent cotton issues, the Hon’ble Union Minister of Textiles, Piyush Goyal formed a Textile Advisory Group under the Chairmanship of Shri.Suresh.A.Kotak, convened a series of meetings for the first time with the Ministry of Agriculture and SEBI and took numerous corrective measures to bring stability to cotton prices. Consequent to the meeting held by SEBI along with MCX and industry stakeholders on 26th August 2022, certain changes were brought in the MCX trading. The MCX cotton price has significantly come down within a week which has softened the domestic cotton price.
In a Press Release issued here today, Mr.Ravi Sam, Chairman, The Southern India Mills’ Association (SIMA) has appreciated the proactive and bold steps taken by the Hon’ble Union Minister of Textiles to control the speculation in cotton trading by directing SEBI and MCX to bring necessary changes so as to enable the cotton futures trading to benefit all the stakeholders in the cotton textile value chain and protect the jobs of 35 million people directly employed in the cotton textile value chain and also around 6.5 million cotton farmers.
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