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Informist, Monday, Jun. 15, 2026

MUMBAI - Following the government's decision to exempt cotton imports from duty, analysts expect a jump in its availability as also the year-end stock. The Cotton Association of India expects imports in the current 2025-26 season to rise to 6.0 million - 6.5 million bales (of 170 kg each), from its earlier estimate of 4.7 million bales, said Kedia Advisory in a note Monday.

"Imports totalling 4.35 million bales had already arrived at Indian ports by the end of May, representing a nearly 32% increase compared to the same period last year. Market participants anticipate an additional 1.5 million bales of imports following the recent duty exemption," it said.

The government has exempted cotton imports from payment of duty with effect from Jun. 1, according to a notification from the Ministry of Finance on May 30. The exemption will remain in force till Oct. 31, according to the notification. With this, the government has removed the 5% basic customs duty, 5% agriculture infrastructure and development cess, and 10% social welfare surcharge on both levies, adding up to an import duty of 11%, on cotton.

The increase in imports is expected to lift India's carry-forward stocks at the beginning of the 2026-27 season (Oct. – Sept.) to 8.6 million bales, around 42% higher than the previous season's estimated closing stock of 6 million bales. The association has maintained its cotton production estimate for 2025-26 at 33.4 million bales. Exports in the season are estimated at 1 million. Cotton consumption for the season is estimated at 32.2 million tonnes.

At the end of May, total cotton stocks were estimated at 19.1 million bales, with mills holding around 8.2 million bales and the remainder held by Cotton Corp. of India, traders, ginners, and multinational companies, Kedia note said.

India's textile mills continue to show strong preference for imported cotton despite near parity in domestic and international prices, the note said. Imported cotton provides about 4% higher yarn realisation and yarn produced from imported fibre commands a premium of nearly INR 7 per kg in the market. These advantages have made imported cotton more attractive for spinning mills, it said.  End

Reported by Abhijit Doshi

Edited by Avishek Dutta

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