Monthly Rate Movement Report December– 2021
Posted : January 25, 2022

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.

 

Quarterly Rate Movement

  • Up trend in cotton prices during first quarter of new season has continued with cotton prices touching life time new high in Indian cotton. While in U.S. It is the second highest rate after 2011.
  • Indian Mills earned well during first quarter with old crop CCI stock till October and new arrivals.
  • This quarter is special bonanza to farmers with Kapas rate marching from Rs. 7,500 to Rs. 10,000 per quintal. In certain areas cyclone and rainfall on standing crop caused some damage to the cotton crop.
  • Indian Shankar-6 journey started from 57,000 and crossed 70,000 marks till end December.
  • Cotton seed rate has movement between 2,600 to 4,000 Rs. Per quintal in this quarter.
  • After Diwali government tried to intervene and reduce yarn prices but it did not sustain due to good demand and international market support.

 

Monthly Rate Movement

  • Wish all cotton friends happy, healthy and prosperous new year from team GUJCOT
  • December was month of volatility. This month has given chance to both, bears and bulls. At one stage There was a good chance to fix their on-call with expiring month of December and all contract converted to lead March month. Spread of Omicron virus and its effect was main point of concern for volatility during the month. WASDE was neutral so there was no big effect of WASDE.
  • On ICE exchange major trading was in lead month March which gained nearly 619 points M/M. During the month with various reasons, it got high to 110 and came back to 104. But in last holiday week it witnessed steep rise and closed at 112.6 cents per lb.
  • Export sales were not bad but pace of shipment is slower than required. Only 29 lakh bales are shipped till this month end. USDA may revise their export numbers for current season If pace of shipment doesn’t improve.
  • Forward market is inverted and huge inversion from current year to next year.
  • In Indian physical market it is double bonanza for farmers in December. Kapas rate has touch life time high near 9,000 to 10,000 per quintal.
  • Shankar-6 spot rate rallied from 64,000 to cross 70,000 mark.
  • Even with life time high rate of kapas farmers are reluctant to sell their produce and arrivals remained very low.
  • Due to slow arrivals general trade people were worried about Indian cotton crop size for the season.
  • Indian mills still have good margin in spinning and are covering on regular basis but at this high rate restricted to build big inventory.
  • Yarn market is also supportive and rising back-to-back with cotton.
  • Indian rupee was weaker in first half but got stronger in later half of the month and stayed near 74.50 Rs per USD at the end of the month.
  • Indian basis remained strong and does not give big opportunity to cover by basis. It remained between 100 to 700 positive during the month.
  • With higher basis Indian cotton does not find big demand from abroad but fix sellers of December shipment were main buyers.
  • Disparity in ginning and higher freight has restricted big quantity to migrate to Gujarat from neighboring states.
  • Over all last quarter of 2021 was Bull dominated and smiling market for farmers.
  • Wish you all earning time in New Year 2022.

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