Cotton on MCX settled down -0.73% at 19030 on subdued demand from bulk consumers and improved arrivals local mandis. There are reports from Pakistan that suggest that with a ban on cotton imports from India, cotton yarn imports would gain momentum as local industry would fail to compete with cheap Indian yarn. All India arrivals improved to around 125,000 bales. In global markets, data from the United States Department of Agriculture (USDA) showed net upland sales of 202,300 running bales of cotton for last week, down 21% from the previous week. Cotton output in 2016-17 is likely to rise by 3.8 per cent in from a year ago due to a sharp increase in yield following a favourable monsoon. The Cotton Advisory Board (CAB) in its meeting estimated cotton output at 35.1 million bales of 170 kg each for the cotton year 2016-17 that started on October 1. The cotton output was 33.8 million bales in 2015-16. Area under Bt cotton has fallen from 10.68 mn hectares in 2015-16 to 8.61 mn h in 2016-17. There was an increase in the area under non-Bt cotton from 1.19 mn h in 2015-16 to 1.89 mn h in 2016-17. Domestic cotton spot prices are suppressed down by 8 per cent in month of October compared to the previous month as the fresh arrival of crop has picked in Northern markets of Punjab, Haryana and Rajasthan. Technically market is under long liquidation as market has witnessed drop in open interest by -3.52% to settled at 4193 while prices down -140 rupee, now Cotton is getting support at 18973.4 and below same could see a test of 18916.7 level, And resistance is now likely to be seen at 19113.4, a move above could see prices testing 19196.7.

Trading Ideas:

Cotton trading range for the day is 18917-19197.

Cotton prices dropped on subdued demand from bulk consumers and improved arrivals local mandis.

Data from the United States Department of Agriculture (USDA) showed net upland sales of 202,300 running bales of cotton for last week.

The CAB estimated cotton output at 35.1 million bales of 170 kg each for the cotton year 2016-17

Cotton prices in spot market gained by 20.00 rupees and settled at 18920.00 rupees.