New Delhi: The below-normal rainfall associated with El Nino may be good news for the cotton sector, as officials and industry executives expect farmers in key rain-fed states to shift from water-intensive crops to cotton, helping bridge the current sowing gap.
A normal cotton crop would ensure adequate raw material for textile manufacturers and reduce the scope for any increase in textile prices stemming from costlier imported cotton amid ongoing geopolitical tensions.
This comes against the backdrop of cotton acreage trailing last year's level. Cotton has been sown over 92.53 lakh hectares as of 17 July, down 5.96% from 98.39 lakh hectares in the corresponding period last year, according to the agriculture ministry's latest weekly sowing data.
The development is significant because cotton remains the dominant raw material for India's textile and apparel industry, accounting for around 80% of the fibre consumed by the sector and around 65% of apparel production.
- Cotton sowing trails last year by 5.96% amid early-season El Niño uncertainty.
- Maharashtra, Gujarat sowing falls; Telangana, Andhra Pradesh post gains this cotton season.
- CCI chief expects farmers to shift toward cotton if rainfall stays deficient.
- Import duty waiver until October eases supply concerns before new crop arrives.
- Ex-Tirupur exporters' head warns global El Niño impact could still disrupt supplies.
The initial sowing data also show mixed trends across major cotton-producing states. Maharashtra, the country's largest cotton producer, recorded a 6.82% decline in acreage to 34.21 lakh hectares, while Gujarat saw sowing fall 9.76% to 16.75 lakh hectares.
In contrast, Telangana reported a 6.62% increase to 16.64 lakh hectares, and Andhra Pradesh posted a 34.2% jump to 2.75 lakh hectares.
The final acreage will be closely watched by the textile industry. Cotton acreage has remained around 115 lakh hectares over the past two years, while production has fallen from 336.6 lakh bales in FY23 to 290.24 lakh bales in FY26, tightening domestic supplies and increasing reliance on imports.
Positive for now
As of now, the import duty of around 11% on cotton imports has been waived until October 2026. Thereafter, the arrival of the new domestic cotton crop is expected to ease supply concerns.
“There is no need to worry for textile manufacturers with respect to the availability of domestic cotton. The acreage is expected to improve, given that El Niño may encourage farmers in cotton-growing states to shift to cotton in the event of deficient rainfall,” said L.K. Gupta, chairman-cum-managing director, Cotton Corporation of India, a public sector undertaking under the Ministry of Textiles. “There is a reason for this. Other crops may not yield well under deficient rainfall, but in the case of cotton, there is always a good chance of getting a reasonable yield even if rainfall is deficient.”
Gupta further said that CCI is working closely with textile mills and making concerted efforts to supply cotton directly to manufacturers rather than traders, to help keep textile prices under control while ensuring farmers receive better prices for their produce.
Industry executives also echoed the assessment, saying current sowing trends do not indicate any major risk to cotton output.
“The sowing season is still at an early stage, and planting is picking up. The acreage gap is expected to narrow over the coming weeks. So there is no need to worry about cotton production,” an executive at a leading textile company said on condition of anonymity due to operational sensitivities.
El Nino may hit imports
Former Tirupur Exporters' Association president Raja M. Shanmugam, however, said that El Niño remains a global phenomenon and could still disrupt cotton supplies if production declines in major producing countries.
“The El Niño effect is not limited to India; it is going to be global. If there is a shortfall in production, there are chances of supply disruptions, resulting in higher raw material prices. In that case, the government will need to come out with corrective measures to support the industry,” Shanmugam said.
“In such a scenario, the role of CCI is going to be crucial. Since not all spinning mills can buy and store cotton for long periods, CCI should create a buffer stock and release cotton to mills from time to time at the MSP (Minimum Support Price). The cotton should be sold only to genuine users, not traders, as traders often engage in speculation and many are backed by foreign investors,” he added.
Farmers in key cotton-growing states also said deficient but well-distributed rainfall could encourage a shift towards cotton.
Ishvar Bhai Chavda, a cotton farmer from Gujarat's Morbi district, said farmers would prefer cotton if rainfall proves deficient. Chavda, who cultivates cotton on his 10-acre farm, has already completed sowing on his entire land, while many of his fellow farmers are also preparing to sow the crop, often referred to as 'white gold'.
Another farmer, Ganesh Nanote from Maharashtra's Vidarbha region, said lower but timely rainfall is beneficial for the cotton crop.
"If rainfall is lower but arrives on time, cotton production will increase, along with the sowing area. Soybean, which farmers often cultivate as a diversification crop alongside cotton, requires more water. So, farmers who would otherwise grow soybean are likely to shift to cotton," Nanote said.
Imports of raw cotton rose 54.9% year-on-year to $1.89 billion in FY26, according to DGFT data. In contrast, exports declined 33.9% to $436.37 million during the same period.