Cotton yesterday settled up by 1.93% at 57100 as Haryana has recorded its lowest cotton yield over two decades in 2022-23, even though the state has almost completely transitioned to the genetically modified Bt cotton which was introduced in north India as a pest-resistant, yield-improving variety in 2005-06. China's total cotton planting area has fallen 10.3% on last year, according to survey data by China Cotton Storage Information Centre. The country's total cotton planting acreage as of May was 41.40 million mu, equivalent to 2.77 million hectares, the survey data showed. Acreage in the northwestern Xinjiang region, China's leading cotton producing region, fell by 8.0% to 36.16 million mu, equivalent to 2.42 million hectares.
In the global 2023/24 cotton balance sheet, higher beginning stocks and production more than offset an increase in consumption, and ending stocks are projected 515,000 bales higher than in May, at 92.8 million. The forecast for world cotton production is 1.0 million bales higher this month as larger crops in the United States and Pakistan offset a 500,000- bale reduction for China. Consumption is 765,000 bales higher with increases in Vietnam, Pakistan, Bangladesh, Indonesia, and Turkey. World trade is also projected higher, up 900,000 bales, led by increased U.S. exports and China imports.
Technically market is under short covering as the market has witnessed a drop in open interest by -1.5% to settle at 329 while prices are up 1080 rupees, now Cotton is getting support at 56540 and below same could see a test of 55970 levels, and resistance is now likely to be seen at 57540, a move above could see prices testing 57970.
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