The Indian cotton spinning sector is projected to grow by 12-14 percent in fiscal 2024-25 beginning from April 1, and cotton yarn exports are anticipated to surge by 85-90 percent, primarily due to China Plus One.
“The surge in Indian cotton yarn overseas shipments will be led by imports from the United States and the European Union, particularly in the spring-summer season,” an ICRA press release informed.
ICRA also anticipates a deceleration in cotton prices, which is expected to affect yarn realisations, and consequently, revenues from the sector will decline 9-10 percent over the 2023-24 fiscal.
ICRA added that a sharp decline of 53 percent was seen in Indian cotton yarn exports in the 2022-23 fiscal, but yarn shipments have started to accelerate in the current fiscal.
According to ICRA, total cotton yarn export volumes rose by almost 142 percent yearly but on a low base in the earlier fiscal year.
The 142 percent growth resulted in the share of yarn exports in overall production rising to 33 percent in the seven months to October 2023 from 19 percent in the same months of the previous fiscal.