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.
We hope it will be useful to all the stake holders of Textile Value Chain.
The cotton market witnessed significant volatility during the month, driven largely by macroeconomic developments and geopolitical events. Both the NY July and December futures contracts trended higher through mid-month, with July reaching 87 cents and December surpassing 88 cents. However, the rally was short-lived, as both contracts reversed sharply and ended the month at approximately 76 cents and 79 cents respectively. Overall, the market experienced an exceptionally volatile trading range of nearly 11 cents during the month.
The primary drivers of market fluctuations were changing macroeconomic conditions, political developments surrounding the Iran conflict and ceasefire discussions, and sharp movements in crude oil prices. From a fundamental perspective, favorable rainfall in Texas was the main bearish factor influencing prices.
The July-December spread widened considerably by month-end, with December carrying a premium of 3.44 cents over July, reflecting a full carry market structure.
U.S. export sales remained modest; however, export shipments continued at a strong pace, indicating that the USDA's export target of 12 million bales remains achievable.
The Indian cotton market largely followed the trend of NY futures. The Cotton Corporation of India (CCI) increased its selling prices in line with the rise in international markets and successfully attracted buyers at higher levels. By the end of May, CCI had reportedly sold nearly 72 lakh bales from its stocks.
Gujcot spot rates started the month near ₹62,000 per candy, rallied to around ₹67,000, and then declined to approximately ₹63,000 by month-end, reflecting substantial volatility in the domestic market.
Towards the end of the month, the Government of India announced a temporary exemption of import duty on cotton for a five-month period until October. This policy decision has created downward pressure on domestic cotton prices.
The India Meteorological Department (IMD) has forecast monsoon rainfall at around 92% of the long-period average, which has become a matter of concern for cotton farmers. Meanwhile, sowing activities have commenced in the North Zone.
The Indian Rupee also remained highly volatile during the month, moving between 94.25 and 96.80 against the U.S. Dollar, largely influenced by fluctuations in crude oil prices.
Indian cotton basis, which started the month in negative territory, strengthened to nearly 900 points against the July contract during the month. However, with December now becoming the lead contract, the effective basis at month-end was lower.