Indian Cotton Exports Have Created Artificial Shortage

By Jim.Robinson|June 1, 2011

The export of 5.5 million bales of cotton from India during the early part of this cotton year has created an artificial cotton shortage in the country, according to Shishir Jaipuria, chairman of the Confederation of Indian Textile Industry (CITI). In a statement released by CITI on May 31, it has been reported that cotton textile spinning mills have decided to continue with the voluntarily production slash of 33 percent to 40 percent from June 1 until the stock situation improves.

The recent, one-day strike by Indian spinning mills on May 23, and the subsequent decrease in production, has resulted in a loss of more than $133 million in revenue.

Jaipuria said that the CITI has requested that no further export of cotton be allowed until the arrival of next year’s crop. CITI has demanded urgent steps from the government of India to address the crisis situation that is facing the spinning mills and the entire textile value chain.

However, the fate of cotton exports is more likely to be decided on June 2 , when the heads of the Ministries of Finance, Agriculture, Textiles and Commerce are expected to convene, according to a recent report in The Hindu.