India cotton exports seen reviving in 2009/10

By Sourav Mishra & Abhishek Shanker

MUMBAI (Reuters) - India's cotton exports may rise "significantly" in the year to September 2010, spurred by higher availability and global demand recovery, mainly in China, the major buyer, a senior government official said on Wednesday 7 October.

"Cotton exports should be significantly higher in 2009/10 as we have started witnessing a revival in demand, especially from China," J.N. Singh, joint secretary, ministry of textiles, told Reuters in an interview over the telephone.

The world's second biggest producer exported about 3.8 million bales in the year to September 2009, sharply lower than 8.5 million bales exported in the preceding year, federal government data showed.

Indian cotton exports slumped in the previous year as the government increased minimum support prices by 40 percent in the popular medium-staple variety, affecting India's lower price advantage in the global market, analysts and traders said.

"We have a large carry-over stock and are expecting a good harvest so buyers from other countries will be looking at India for regular supplies," Singh added.

Analysts said India is likely to gain from an expected fall in global output and an increase in global demand by 2 percent in 2009/10 to 23.6 million tonnes.

International Cotton Advisory Committee on Oct 1 said cotton exports from India could rebound while that from the U.S., a major exporter, may decline by 20 percent.

India's cotton output in the year ending September 2010 is estimated at 30.5 million bales, higher than last year's estimated final output of 29 million bales.

Despite a likely better output, domestic prices are expected to remain stable on back of demand from Indian mills, Singh said.

Indian mill demand is likely to be boosted by an ongoing recovery in textile and apparel consumption in developed economies.

"We are seeing positive trends in exports (apparels), particularly in markets like Europe and the U.S.," Dayanidhi Maran said on Wednesday 7 October.

(Editing by Sunil Nair)

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