Sunday, November 9, 2008

Cotton Prices

Farmers are finding it hard to sell cotton at good prices. Although MSP prices are pretty decent this year, farmers are finding very few takers. Government is stepping up the procurement process to support the prices but unfortunately it if not working out. Some farmers are selling cheaper either to pay off the debt or because they dont have infrastructure to store. It is ironical that a higher yield of cotton is adding woes to the farmers instead of helping them.

One important thing to note is that when demand soars and prices are high, government alters it policies (like capping the price, increasing the imports etc) to keep check the prices. Most of the times it is successful in doing so but it fails miserable to keep up the prices in the times like this. So for a farmer, its always like loosing on any side of the coin.

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