Gujcot Trade Assocation

Gujcot Monthly Rate Movement Report – Aug-2023

Posted : April 27, 2024

Dear All Cotton Friends,

In our mission to give Daily Spot Rate Team Gujcot is getting valuable support from Gujcot broker’s panel. We appreciated their humble service to the trade. Gujcot Team is giving daily closing of Indian and foreign futures rates.

In this report we have provided Following Rates during the month.

Daily Physical Spot Rate

MCX Cotton Daily Closing Rate

USD-INR Exchange Rate Closing

Cotlook Index

ICE Future Closing

NCDEX Kapas Rate

MCX Future Closing

NCDEX and MCX converted into Rs. Candy Rate

We hope it will be useful to all the stake holders of Textile Value Chain.

During the August, the NY December Futures attempted multiple times to break out above the 88 cents level, but each attempt proved unsuccessful. The NY futures remained confined within a narrow range of 83 to 88 cents.
The WASDE report delivered a bullish outlook as the U.S. Department of Agriculture (USDA) lowered the U.S. crop by 2.5 million bales. This bullish sentiment from the WASDE report initially pushed the NY futures toward the upper boundary of the established range. However, the prevailing macroeconomic conditions exerted counterpressure, preventing a sustained upward movement. As the final week of August unfolded, repeated efforts were made to achieve an upper breakout, yet they were met with continued resistance.
In the previous year, exports fell short of the target, resulting in the carryover of remaining export sales to the current year. While new commitments were sluggish in August, shipment numbers showed improvement.
The Indian physical cotton market experienced an upward swing from the beginning of August. The prices surged from 58,300 to 61,300 in the first half of the month, followed by a period of stability ranging between 60,000 and 61,000 in the latter half.
Cotton arrivals in India were slower, ranging from 30,000 to 40,000 bales per day, with Gujarat averaging around 10,000 bales per day. This slower arrival rate, while significant, still marked the highest August arrival in the history of the Indian cotton season.
Indian basis values remained generally stable, fluctuating from 4.5 to 10.00. Despite this stability, Indian cotton's export parity was deemed unviable, leading to limited raw cotton exports in August. The demand for yarn remained sluggish, causing mills to operate below their optimal capacities.
Throughout the month, the Indian rupee maintained stability within the range of 82.25 to 83.14 against USD.
As the cotton sowing season in India is nearing its end, the total sowing area by the end of August reached 122.556 lakh hectares, slightly below but comparable to the previous year's figures. In Gujarat, the sowing area was recorded at 26.793 lakh hectares, surpassing the previous year's sowing area of 25.451 lakh hectares.
India experienced its driest monsoon in a decade, putting significant stress on cotton-growing regions. Adequate rainfall became crucial for safeguarding the cotton plants.
New arrivals from the northern regions have commenced, raising hopes for contributions from other states as well. Concurrently, there is still residual pressure from the old crop in Gujarat and Maharashtra.
Optimism is held for the forthcoming month, with expectations of improved rainfall and subsequent arrivals.