India cotton prices rose by ₹4,500 per candy after the cotton year began on October 1, 2026, reaching ₹68,500 per candy for benchmark Gujarat 29-millimeter cotton, spot price data showed. Industry leaders expect a wider supply shortfall as the country’s import duty exemption approaches its October 31 expiry.

Key Takeaways

  • India’s cotton imports reached an estimated 7.1 million bales in 2025–26, with each bale weighing 170 kilograms.
  • A textile industry leader expects demand to exceed 36 million bales in 2026–27 while production may fall below 28 million bales.

India cotton prices and the duty deadline

Cotton prices have risen more than 7% over the past month. Industry leaders said the increase came ahead of the scheduled end of an exemption from the 11% duty on raw cotton imports.

The current exemption runs from June 1 through October 31, 2026. An earlier exemption ran from August 19 through December 31, 2025. Industry veterans also pointed to expectations of a smaller crop and uncertainty over whether the current exemption would be extended.

Mills expect a wider supply gap

The Southern India Mills Association, or SIMA, said India consumed around 34 million bales and imported about 7 million bales in 2025–26. Total imports were estimated at a record 7.1 million bales, compared with 5.74 million a year earlier.

SIMA Secretary General K. Selvaraju said the gap between demand and supply could widen to more than 9 million bales in 2026–27, from 7 million bales the previous year. He said the association had seen increased export demand from the UK in recent months and expected textile trade agreements to increase cotton consumption.

Selvaraju said demand could exceed 36 million bales while production might fall below 28 million, with El Niño and drought affecting crops in several regions. He also said demand would rise further if an EU free trade agreement is implemented in 2027. Overall production is expected to fall 3.4% in the crop year ending September 2027.

Ginners face higher raw cotton costs

Pradip Jain, president of the Khandesh Ginners’ Association, said ginning had become challenging because yarn prices had not risen in proportion to cotton prices.

Industry leaders said some farmers were holding their crops in anticipation of higher prices. They also said a lack of moisture had led many farmers to pick cotton only once and clear their fields for alternative crops.

Next milestone

The next confirmed milestone is October 31, when the current cotton import duty exemption is scheduled to expire.

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