ICMFs Ploy Misfires

ICMF's Ploy Misfires D P Sharma THE way the cotton scenario has unfold- ed this season makes an interesting study which underlines the imperative need for a more careful and objective assessment of the supply-demand position to enable the formulation of appropriate policy inputs to subserve diverse interests. The situ- tion obtaining at a time when the season has only a little over three months more to go contrasts sharply with that which prevailed at the beginning of the season in that the market which had not witnessed the normal seasonal decline in the wake of the progress of the marketing season is currently witnessing a contra- seasonal decline. Mills which had figured as avid buyers at asked-for prices earlier are now reluctant to take up cotton on offer at substantially lower prices. Barring a few isolated instances, cotton prices have moved down by 4.3 per cent to 15,7 per cent (depending on the variety) from their February highs which are not much lower than the prices ruling at the beginning of the season. Only quality cottons from the northern region have been displaying a steadier tendency over the past few weeks. However, the decline of Rs 600 to Rs 2,000 per candy from the February highs, carrying most varieties to below the half-way marks between the season's highs and subsequent lows, when over 113 lakh bales of cotton have moved into the market provides little indication of the gravity of the situation. There are virtually no takers for cotton even at the reduced prices. Payments against deliveries are being inordinately delayed. Institutional TABLE; COTTON BALANCE-SHEET FOR 1991-92 (In lakh bates) agencies are being obliged to carry large stocks of cotton 'sold but not lifted'.