**Executive Summary**
This document, dated December 19, 2025, by PIB Delhi, addresses the softening of domestic cotton prices due to the exemption of the 11% import duty on cotton. It highlights the government's support to cotton farmers through the Minimum Support Price (MSP) mechanism. The document provides information on cotton imports, domestic consumption, and MSP procurement data, including data up to December 8, 2025.
**Key Points / Main Content**
* **Cotton Prices and Import Duty:**
* The 11% import duty exemption on cotton led to a softening of domestic prices.
* International cotton prices (S-6 equivalent) declined from approximately 79.15 US cents per pound (prior to August 19, 2025) to around 73.95 US cents per pound in December 2025.
* Domestic cotton prices softened from about ₹57,000 to ₹52,500 per candy.
* Cotton imports constituted about 13.93% of total domestic consumption during the 2024-25 season.
* **Minimum Support Price (MSP):**
* The government supports cotton farmers through the MSP mechanism, ensuring at least a 50% return over the cost of production.
* For the 2025-26 season, MSP is fixed at ₹7,710 per quintal for medium staple and ₹8,110 per quintal for long staple cotton (an increase of ₹589 per quintal over 2024-25).
* As of December 11, 2025, the Cotton Corporation of India (CCI) procured about 31.19 lakh bales worth ₹13,492 crore under MSP operations through 570 procurement centers across 149 districts in 11 States.
* **Cotton Imports:**
* Cotton imports from the USA have increased to meet domestic textile industry requirements.
* Cotton imports in India rose from 15.20 lakh bales in 2023-24 to 41.40 lakh bales in 2024-25.
* **Cotton Corporation of India (CCI):**
* The CCI procures cotton under MSP to ensure remunerative prices for farmers.
* MSP operations safeguard farmers against price volatility.
* **Procurement Data**
* Includes Quantity Procured Under MSP During the Last Five Years, Against Production.
* Up to 8.12.2025.
**Impact Analysis**
**Stakeholder: Cotton Farmers**
* **Impact:** The MSP mechanism aims to safeguard farmers against price volatility and ensure fair returns.
* **Action Required:** Farmers should be aware of the MSP rates for the 2025-26 season and utilize the 570 procurement centers.
**Stakeholder: Domestic Textile Industry**
* **Impact:** The increased cotton imports help meet the quality and supply requirements of the industry, particularly for specialized varieties, supporting export-oriented production and global competitiveness.
* **Action Required:** The industry should continue to engage with suppliers, including those in the USA, to ensure sufficient cotton supply.
**Stakeholder: Cotton Corporation of India (CCI)**
* **Impact:** Continue their MSP operations.
* **Action Required:** To procure cotton under MSP to ensure remunerative prices for farmers.
Key Entities Referenced
Minimum Support Price (MSP): A mechanism to support cotton farmers by providing a minimum return over the cost of production.
Cotton Corporation of India (CCI): Procures cotton under MSP to ensure remunerative prices for farmers.
Ministry of Textiles: The government ministry responsible for policies related to the textile industry.
United States of America (USA): Country from which cotton is imported to meet quality and supply requirements of the domestic textile industry.
Ministry of Textiles
COTTON IMPORT DUTY AND LOW PRICE
प्रव तथ: 19 DEC 2025 6:29PM by PIB Delhi
The Government is aware that the exemption of 11% import duty on cotton has led to a softening of
domestic prices. Since the duty exemption, international prices of equivalent S-6 cotton declined from
about 79.15 US cents per pound prior to 19.08.2025 to around 73.95 US cents per pound in December
2025, indicating a downward global trend. Domestic cotton prices have softened correspondingly from
about ₹57,000 per candy to around ₹52,500 per candy, broadly in line with international price movements.
Domestic prices are influenced by global and domestic demand-supply conditions, exchange rate and
quality considerations, while cotton imports constituted about 13.93% of total domestic consumption
during the 2024–25 season. Since the exemption, prices have softened, currently ranging between
₹51,500–₹52,500 per candy, ensuring affordability for the industry while MSP-based support continues to
protect farmers.
The Government supports cotton farmers through the Minimum Support Price (MSP) mechanism, which
provides a minimum of 50 per cent return over the cost of production. For the 2025–26 season, MSP has
been fixed at ₹7,710 per quintal for medium staple and ₹8,110 per quintal for long staple cotton, an
increase of ₹589 per quintal over 2024–25. To prevent distress sales, the Cotton Corporation of India has
procured about 31.19 lakh bales worth ₹13,492 crore under MSP operations as on 11.12.2025 through 570
procurement centres across 149 districts in 11 States.
Cotton imports from the United States of America (USA) have increased to meet the quality and supply
requirements of the domestic textile industry, which consumes about 94% of India’s cotton. During
August–September 2025, including the period after the temporary exemption of the 11% import duty,
imports from the USA aligned with industry needs. Overall, cotton imports in India rose from 15.20 lakh
bales in 2023-24 to 41.40 lakh bales in 2024-25, helping bridge the demand–supply gap. These imports
ensure the availability of specialized cotton varieties and support export-oriented production, thereby
enhancing the global competitiveness of India’s textile sector.
The Cotton Corporation of India (CCI) procures cotton under MSP to ensure remunerative prices for
farmers. MSP operations continue to safeguard farmers against price volatility and ensure fair returns.
Statement showing quantity procured under MSP during the last five years, against the production, is
given below:
Cotton Production (Lakh Quantity Procured under MSP Qty. procured (% of
Season Bales) (Lakh Bales) production)2025-26 292.15 24.92* 8.53*
2024-25 297.24 100.16 33.70
2023-24 325.22 32.84 10.10
2022-23 336.60 - -
2021-22 311.17 - -
2020-21 352.48 99.33 28.18
mnse. In Cotton Season 2021-22 & 2022-23, cotton prices were ruling above MSP. Hence, no MSP
support required by farmers.
* upto 8.12.2025
This information was provided by THE MINISTER OF STATE FOR TEXTILES SHRI PABITRA
MARGHERITA in a written reply to a question in Rajya Sabha today.
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MAM/VN
(Rajya Sabha US Q. 2400)
(रलीज़ आईडी: 2206685) आगंतुक पटल : 653
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