Global cotton prices have declined significantly as resellers and multinational corporations offer discounts amid weak demand conditions. According to reports from The Hindu BusinessLine, cotton futures on ICE have eased, with domestic resellers and multinationals now selling stocks at rates below those set by the Cotton Corporation of India (CCI). This development comes despite the fact that ICE cotton futures had gained around 47% since early February, reaching a recent high of 88 cents per pound on May 11 before retreating to current levels of 76-77 cents. The latest price movement is attributed to improving weather prospects in the US and Brazil, decline in crude oil prices, stronger US dollar Index and uncertainty around global demand recovery, as reported by CotYarn Trade Link in their weekly newsletter. As per the latest market data, cotton futures closed at 77.37 cents on May 26, showing continued downward pressure.
Indian cotton prices in the physical market have also corrected following the easing trend in futures, though the decline remained limited compared to international markets due to specific domestic factors. As reported by The Hindu BusinessLine, the Indian basis, the difference between spot prices and futures against ICE July, strengthened to 8.55 cents per pound, indicating that Indian cotton continues to trade at a premium over global futures. According to CotYarn Trade Link, this premium is attributed to lower arrivals, tightening spot availability, and higher domestic basis levels in the Indian market. Market expert Anand Popat notes that "CCI still holds sizeable unsold stocks, which may continue to influence domestic market sentiment in the coming weeks. Overall, the market remains technically weak in the short term, but strong Indian basis levels and tightening domestic supply may continue to support Indian cotton prices relative to global markets."
The Cotton Corporation of India (CCI) currently holds significant unsold stocks that continue to influence market sentiment. According to trade sources cited by The Hindu BusinessLine, CCI procured about 105 lakh bales of 170 kg each during the 2025-26 season and has sold around 72 lakh bales so far. The corporation's stocks are estimated at around 33 lakh bales, with CCI having stopped selling cotton from May 22 due to technical reasons. CCI had initially reduced prices from the minimum support price of ₹57,200 per candy to around ₹54,600, subsequently increasing them to up to ₹68,600 tracking global price trends. For the 2026-27 marketing season, the Centre has increased minimum support price by ₹557 per quintal to ₹8,267 for medium staple and ₹8,667 for long staple.
Market conditions remain challenging with significant price volatility affecting both cotton and yarn sectors. As reported by The Hindu BusinessLine, sourcing agent Ramanuj Das Boob from Raichur noted that "resellers and multinationals are selling at prices ₹2,000 per candy lower than CCI list prices," with buyers abstaining from the market for both cotton and yarn. The yarn market is particularly dull, with yarn prices declining by ₹30-35 per kg from previous levels, as reported by CotYarn Trade Link. Despite current weakness, the Cotton Association of India (CAI) expects cotton acreage to rise by around 7% in the upcoming kharif season as farmers are encouraged by remunerative prices. Cotton was planted on 114.82 lakh hectares during 2025-26, according to data from the Agriculture Ministry.
