Indian Cotton Exports Fall Short as Deadline Passes
The Indian government remains undecided about what to do with the 2 million bales of unshipped cotton.
December 16, 2010
According to estimates from multiple sources, Indian exporters have physically shipped only 2.5 million to 3 million bales of cotton (170 kg) to overseas buyers by the Dec. 15 deadline, which was established by Indian government officials on Nov. 1. Exporters registered their cotton shipments by applying for Export Authorization Registration Certificates (EARCs), but the actual shipment period was restricted to 45 days from the date of issue of EARC by the government or December 15, whichever is later.
As of December 16, India has issued EARCs for 5,023,140 bales and rejected the export registration for about a quarter of a million bales. It will take a few weeks to determine the exact amount that was shipped, about 2.5 million to 3 million bales of the 5.5-million-bale limit were approved for export but never shipped.
Yesterday, Subhash Grover, chairman and managing director of Cotton Corporation of India, told Cotton International that he agrees with reports about the amount of cotton exported as of December 15th. Nayan Mirani of Khimji Visram and Sons in Mumbai--who is also the Vice President of Cotton Association of India--also agrees with the reported figures, although he emphasized that it was his own personal estimate and not an official statement from the Cotton Association of India.
During a telephone interview with Cotton International, Indian Textile Commissioner A. B. Joshi said that until the government receives actual shipment data from ports, officials will not be in position to make any decisions about the millions of bales that remain unshipped. Exporters have 21 days from the actual shipment of cotton to report the exact shipment data to the government, so it likely will be the end of January before a decision from India can be made. The data has to be compiled so that the meeting of Central Ministers of the departments of Agriculture, Textiles, Commerce and Finance can convene to make a decision. One of the factors influencing their decision will be the size of next year’s cotton crop; estimates put it at about 32.5 million bales for the season ending Sept. 2011.
Be sure to watch for Cotton International’s March issue for a comprehensive report on the cotton and textile markets in India!