Coimbatore, Feb 28 (KNN) The Confederation of Indian Textile Industry chairman T. Rajkumar along with Ravi Sam, chairman of the Southern India Mills Association on Monday urged textile mills, garment units and weavers to use MCX platform to buy cotton.

Addressing the media, the Industry associations said, “following steep increase in cotton prices last cotton season (October 2021 to September 2022), textile units demanded the need to streamline cotton trading on the MCX platform.”

Hence, the Product Advisory Committee was formed and based on its suggestions, a new cotton contract started functioning on the MCX from February 13.

“Under the new system, a lot should have 50 lakh to 100 lakh bales, there would be godowns across the country, a person could trade only maximum 20,000 bales, and the price increase on a day would be maximum 6 per cent,” they said.

The aim of the new system is to increase cotton liquidity in the market.

As per reports, the average volume of cotton traded on MCX platform was worth about Rs 150 crore a day and most of the trade was by traders and ginners.

Since the launch of the new system, the volume traded remained low and to increase it, awareness should improve and more textile units need to take part.

The total volume of business on the MCX platform was only around three lakh bales as against the industry consumption of 300-320 lakh bales and the country’s cotton production was 340– 360 lakh bales a year.  (KNN Bureau)