IBEF: September 11, 2019
The total acreage under Bacillus thuringiensis (Bt) cotton jumped to 93.5 per cent this kharif sowing season after falling to 90 per cent three years ago.
A Kotak Securities' Commodity Insight report highlights India's total cotton acreage under Bt at 11.7 million ha during the current kharif sowing season. Total area under non-Bt cotton was reported at 0.8 million ha. Data compiled by the Ministry of Agriculture estimates total area under cotton sowing this year at 12.5 million ha as of August 31, a rise of 7.3 per cent from the previous year.
Farmers were encouraged by two major factors this year to bring back cotton sowing under Bt. Firstly, the crop damage last year due to deficient rainfalls prompted farmers to sow insect resistant transgenic crop which has a potential to fetch some output even with normal traits. Secondly, the increase in the minimum support price also lured farmers to go back to their old farming practice. Until 2016-17, Indian farmers were sowing Bt cotton in around 95 per cent of the area allocated to this cash crop.
"Of the 12.5 million ha of overall acreage under cotton, 93.6 per cent or 11.7 million ha has come under Bt this year," said Ravindra Rao, Head of Research, Kotak Securities in a report titled Commodity Insight.
With this, the insect resistant transgenic crop has regained farmers' confidence which had been shaken three years ago due to a stagnation in cotton yield after significant a pickup in the initial years of its launch.
Bt cotton regains farmers' confidence, acreage under crop goes up to 93.6 per cent.
Cotton prices remained highly volatile last year. After trading below the minimum support prices (MSP) for a long period, cotton prices recovered to surpass this benchmark level. The government raised the cotton MSP by Rs 100 to Rs 5,550 (US$ 79.4) a quintal this year again from Rs 5,450 (US$ 77.97) a quintal last year.
"The government must allow farmers to sow the latest high yielding seeds available in Bt series with more traits that global farmers have already been sowing. Indian farmers are using Bollgard I and II varieties of Bt transgenic seeds which have reported stagnation in yield. In the absence of any option, farmers are continuing with the seeds available," said Arun Sakseria, a city-based cotton trader and exporter.
The uneven distribution of the monsoon rainfall caused severe damage to the cotton crop in its major growing states like Maharashtra, Gujarat, Andhra Pradesh and Telangana.
By the end of August, cotton acreage in Maharashtra had crossed 4.37 million ha against 4.1 million ha sown during last year. A minor decline was seen in Gujarat cotton sowing this year which reached at 2.65 million ha as compared to 2.69 million ha last year.
Meanwhile, cotton supply across the country in the first four days of September reached 3,370 tonnes, nearly double the supply seen in same period last month. Positive cues from international market and reports of some crop losses in Madhya Pradesh are likely to support the cotton prices to some extent for the next couple of sessions.
"However, bearish broader fundamentals like slack demand from the textile industry, limited yarn export demand and upcoming new crop arrival season will keep cotton prices under check for near future," said Rao.
Cotton prices are currently quoting at Rs 9,100 (US$ 130.20) a quintal in the benchmark Rajkot mandi.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.