Cotton candy prices edged up by 0.09% to 54,420 as the Cotton Association of India (CAI) projected a decline in overall cotton output for the 2024-25 season to 301.75 lakh bales, down from 327.45 lakh bales in the previous season. The expected decline is due to lower yields in Gujarat and northern states, though cotton quality remains high. As of January 2025, the total cotton supply is estimated at 234.26 lakh bales, comprising 188.07 lakh bales of fresh pressings, 16 lakh bales of imports, and an opening stock of 30.19 lakh bales. Domestic consumption until January 2025 is estimated at 114 lakh bales, with exports reaching 8 lakh bales.
Stocks at the end of January are projected at 112.26 lakh bales, including 27 lakh bales with textile mills and 85.26 lakh bales held by CCI, traders, and ginners. CAI maintains its full-season domestic consumption estimate at 315 lakh bales, while exports are projected to drop to 17 lakh bales compared to 28.36 lakh bales in 2023-24. Meanwhile, Brazil's cotton production for 2024-25 is forecasted to rise by 1.6% to 3.76 million tons, with a 4.8% expansion in the planting area, signalling strong global supply. China’s cotton production increased by one million bales, contributing to higher global stocks. In Rajkot, a key spot market, prices dropped by 0.26% to 25,655.75 rupees.
Technically, the market is under a short covering, with open interest remaining unchanged at 253. Support is at 54,310, with a potential test at 54,190, while resistance is seen at 54,540, with a move above possibly pushing prices to 54,650.
