7 months ago
Cotton Prices Rise After Import Duty Exemption Ends
The price of raw cotton in India has gone up by more than 5% because the government stopped giving a special benefit on imported cotton.
This happened at the end of December 2025.
Now, Bangladesh, which buys a lot of Indian yarn, is thinking about adding a 20% tax on yarn imports to help its own yarn makers.
This could make Indian yarn more expensive in Bangladesh.
In India, the Cotton Corporation of India has bought a lot of cotton and is waiting to announce the price for the next year's crop.
Farmers are holding onto some of their cotton, waiting for better prices.
Raw cotton prices in India have increased by over 5% after the import duty exemption ended on December 31, 2025.
Bangladesh is considering imposing a 20% duty on yarn imports to protect its domestic yarn producers.
The Cotton Corporation of India (CCI) has procured over 68 lakh bales of cotton and is expected to announce the price for the 2025-26 crop.
Current raw cotton prices are around Rs 8,000 per quintal, still below the MSP of Rs 8,100.
About 40% of the cotton crop in Khandesh, Maharashtra, has arrived in the market, with farmers holding the rest.
- Who
- Indian cotton farmers, Cotton Corporation of India (CCI), Bangladesh Trade and Tariff Commission, Cotton Association of India
- What
- Raw cotton prices have increased by 5% after the import duty exemption ended, and Bangladesh is considering imposing a 20% duty on yarn imports
- Where
- India and Bangladesh
- When
- The import duty exemption ended on December 31, 2025; Bangladesh's tariff discussion was held on January 2, 2026
- Why
- The end of the import duty exemption has led to a rise in raw cotton prices, and Bangladesh is considering the duty to protect its domestic yarn producers
Key facts
- Current Raw Cotton Price
- Rs 8,000 per quintal
- Minimum Support Price (MSP)
- Rs 8,100 per quintal
- CCI Procurement
- Over 68 lakh bales
- Bangladesh Yarn Import Duty Consideration
- 20% (unofficial)
- Indian Yarn Export
- 30% of total production
- Expected 2025-26 Crop Price
- Rs 57,000 per candy
- Remaining 2024-25 Crop Stocks
- Less than 3 lakh bales
Quotes
Atul Ganatra
Former president of the Cotton Association of India
“There is a possibility of Bangladesh imposing a duty on yarn imports. If the duty is imposed then we will see pressure on local yarn markets as Bangladesh is our main yarn buyer from last few years. We export about 30 per cent of the total yarn produced as our requirement is only 70 per cent of our total yarn production”
thehindubusinessline.com
Ramanuj Das Boob
Sourcing agent in Raichur
“Kapas prices have moved up to the level of Rs 8,000 per quintal, from around Rs 7,500-7,600 levels last week. Also, pressed cotton prices have moved up by Rs 1,000-1500 per candy (356 kg)”
thehindubusinessline.com
Pradeep Jain
Founder President, Khandesh Gin Press Factory Owners Association in Jalgaon
“About 40 per cent of the crop in Khandesh has already arrived in the market, while farmers are holding the rest of it and the picking has been complete”
thehindubusinessline.com
Sources
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