Cotton prices to trade sideways to higher: Angel Commodities
Angel Commodities’ report on Cotton
MCX Cotton Nov futures is trading in a range on mixed fundamentals of higher arrivals and reports of damage to cotton crops in Vidarbha and start of procurement by CCI in Gujarat at higher prices. Moreover, govt. imposed 5% GST under reverse charge mechanism (RCM). The notification says that the GST on supply of raw cotton by farmers will be liable to be paid by the buyers – traders & ginners under the RCM, which makes cotton procurement expensive for them.
Cotton futures are expected trade sideways to higher as CCI has already start its procurement in main cotton growing states. They have a target to procure 100 lakh bales this season. Good demand for kapas may also support cotton prices. However, due to implementation of GST for raw cotton, traders and ginners may go on strike which may put pressure in cotton prices.
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