Cotton surges on strong mill demand

Yesterday, the prices of cotton traded higher by Rs 1,000 a candy (of 356 kg) against that of Rs 46,500 on Saturday as a result of the good demand from the mills.
The Gujarat Sankar-6 variety traded at Rs 46,200-46,500, a candy in Gujarat due to the pick up in the demand from the southern mills while the higher prices of kapas (raw cotton) also was a support to the market.
Meanwhile, the prices kapas quoted higher by Rs 10-15 at Rs 1,040-1,050 for 20 kg in Rajkot while about 45,000-50,000 bales arrived in Gujarat.
A broker said that the prices are rising as a result of the restricted supply in the market and also since the mills are purchasing heavily while the export buying is limited.
Moreover, the Textiles Minister, Mr Dayanidhi Maran stated that the Centre will not permit the exports of cotton to surpass the ceiling of 5.5 million bales.
The Cotton Advisory Board expected the total 2010-11 crop in August at 325 lakh bales (one bale equals 170 kg) that was then revised to 329 lakh bales.
As per the Cotton Corporation of India, about 162.65 lakh bales of cotton had arrived in the local market during October-September that was more than the 152 lakh bales in the same period of 2009-10.
Cotton is a soft, fluffy staple fiber that grows in a boll, or protective capsule, around the seeds of cotton plants of the genus Gossypium.
The plant is a shrub native to tropical and subtropical regions around the world, including the Americas, Africa, India, and Pakistan.
The fiber most often is spun into yarn or thread and used to make a soft, breathable textile, which is the most widely used natural-fiber cloth in clothing today.

(Source: http://money.oneindia.in/news/2011/01/25/cotton-surges-strong-mill.html)