High cotton prices to pinch consumers’ pockets

Last year, high raw material costs and excise duty had

forced retailers to hike garment prices even when consumer buying sentiment was low due to recession and inflation. Once again, retailers will have to raise product rates as prices of cotton, the biggest input for apparels, is going to be higher on account of low rainfall.

According to experts, the cotton prices for upcoming weeks may move higher in the domestic commodity market on increased buying by textile mills and yarn makers on lower arrivals in the spot market as the harvesting season ended and lower rainfalls across the cotton growing regions delaying the sowing process.

According to reports, the prices of the commodity in the spot market increased by Rs 200-300 per candy (356 a kg). While, below rainfall forecast for India is also pushing the price of the commodity as the weak rains is delaying the sowing process of the commodity. The Indian Meteorological Department (IMD), says India received 24 per cent lesser rains in the on-going monsoon season since June 1 compared to last year.

Already, the area under cotton production fell by over 10 per cent for 2012-13 as the farmers turn towards other crops on lower price realisation for the commodity on surplus production.