sanjay jain

8/3/2019 Sanjay Jain

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PRESENTATION

ON

T T Limited


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0

5

10

15

20

25

30

2001-2 2002-3 2003-4 2004-5 2005-6 2006-7

PRODN

IMPORTS

EXPORTS

Indian Cotton story

Figures are in

mln bales

Of 170 kgs each


3/12

Today we shall discuss

About the Indian crop

Varieties of Indian Raw Cotton

Specifications of various types Pros and cons of Indian types

Relevant issues pertaining to trade withBangladesh

Indian cotton market today


4/12

About the Indian crop

3rd year in running, bumper crop expected 27.00 millionbales of 170kg (10% more than last season)

Both area and productivity has grown

Estimates for 2012 is between 39.0 to 45.0 mln bales

Quality is better due to use of better quality and BT seeds

Trash levels/contamination is relatively lower due tobetter ginning practise and BT seeds

Average length of cotton fibre is growing due to BT seeds

hence shortage of short length fibre All cotton is double roller gin except J 34

J 34 (27mm), Shankar 6 (28mm+) and MCU 5 (30mm+)are the popular varieties

Lustre, dye absorption and neps is amongst the best in the

world


5/12

Current Balance Sheet is

Carry forward stock has come down, leading to

pressure on prices

(in million bales of 170 kgeach)

2005-2006 2006 2007

SUPPLY

Opening Stock 7.20 5.60

Crop 24.60 27.00Imports 32.20 33.10

DEMAND 21.70 24.00

Consumption 4.70 4.80

Exports 26.40 28.80

5.60 4.40

CARRY OVER


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STATES 2006-07 2005-06AREA PRODN YIELD AREA PRODN YIELD

PUNJAB 5.88 2.60 752 5.57 2.00 610HARYANA 5.33 1.70 542 5.83 1.30 379

RAJASTHAN 3.50 0.80 389 4.71 1.10 397GUJARAT 23.90 9.30 662 19.06 8.90 794

MAHARASHTRA 31.24 5.20 283 28.75 3.60 213M. P. 6.30 1.80 486 6.20 1.80 494 A. P. 9.62 3.20 565 10.33 3.20 527

TAMIL NADU 1.33 0.50 639 1.40 0.55 668

KARNATAKA 3.70 0.60 276 4.13 0.65 268OTHERS 0.78 0.10 218 0.79 0.10 215

LOOSE LINT 1.20 1.20TOTAL 91.58 27.00 501 86.77 24.40 478

and regionwise break up is

NOTE: AREA IS IN HECTARES/PRODUCTION IN MILLION BALES OF 170 KGS/YIELD IS INKGS/HECTARE


7/12

India has wide range of cotton

Shankar 6 Bunny MCU 5 DCH 32

LRA Mech 1 H4 J 34 V 797 Etc etc

caters to need of yarn from 4/1 to 120/1


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and their basic specs are

Type Length(mm) Mic Strength(gpt)

Trash (%)

S 6 27.5 29.0 3.5 4.9 28- 30 2 - 3

MCU 5 30.0 32.0 3.5 4.9 29 32 2 - 3

DCH 32 34.0 36.0 2.8 3.8 31 33 2 - 3

Mech 1 28.0 29.0 3.5 4.9 27 28 3 - 4

Bunny 29.5 31.0 3.5 4.9 28 29 2.5 3.5

H 4 27.0 28.0 3.5 4.9 26 27 3 - 4

J 34 25.5 28.0 4.0 5.0 25.5 27 4 - 5

LRA 25.0 27.0 3.5 4.9 25 27 3.5 4.5

Y1 24.5 25.5 4.0 5.2 24 26 4 - 5

V 797 23.0 24.0 4.5 6.0 20- 22 12- 15


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Why Indian cotton ?

Type Pros Cons

S 6 Excellent grade, absorption, lustreand strength

Contamination

MCU 5 Good staple length, lustre,absorption and strength

Contamination

DCH 32 Staple length, strength Low micronaire, relatively highertrash

Mech 1 Cheaper than S- 6 Marginally low on all parametersagst S-6

J 34 Good dye absorption, highmic/maturity

High Trash

H 4 Price lowest in its length peers Low uniformity/grade

Bunny Price lowest in its length peers Grade lower than MCU 5

LRA Trash lower than J-34 Mic variance high, grade lowerthan J 34

V 797Inspite of high trash, final yarn

good as it falls out & good lustreHigh trash


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Relevant issues for Bangladesh

High incidence of freight 1 to 2 cents/lbs extra cost agstFar East countries

Availability of a standard recognised laboratory to settledisputes amicably

Lack of proper weightment facilities in Chittagong andmany factories sites

Popular misconceptions of Indian cotton Shankar 6 ? only in Gujarat MCU 5 ? only in A.P/Tamil Nadu/Orissa

Another misconception Indian cotton not good forknitting yarn: all Indian mills making knitted yarn fromthis cotton

Mic values/strength/nep levels are very good in S 6 comparable with any origin

Indian shippers have no system of hedging/buyingforward, hence difficult for them to sell forward better tobuy prompt

Correlation with NY Futures is low


11/12

Indias cotton market today

Arrivals have dropped to about 27000 bales per day agst40000 bales last year same time

Total arrivals for the season have crossed 24.5 mln balesagst 21.0 mln bales last yr

Ginners are holding good quality stock in anticipation ofprice increase as ending stocks are expected to be lowerthan last yr

Spot prices have softened a bit due to poor yarn mkt andrupee appreciation

Import contracts of over 125,000 bales of medium staplecotton have been contracted in last one mth

Low staple cotton availability is very low

Expected fall in acreage in Gujarat in 2007-08(origin ofShankar 6) expected, as cotton may be replaced bysugarcane etc


12/12

sanjay jain

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