PL Global Impex
Cotton Commodity_ A Money Making Market

Cotton Commodity : A Money Making Market

The cotton commodity is very versatile. It is useful for most people on a very large scale. No matter if it is the final product or the raw product, one can use it in every phase, thus making it a multipurpose commodity. The cotton commodity market is very profitable and is also at a developing stage. Keep on reading to understand more about the cotton commodity market. 

Understanding The Cotton Commodity Market

Now, the term or the commodity cotton needs no introduction. Everyone is familiar with this commodity. We will talk about the market here i.e the cotton commodity market. It is a market in which the trade of cotton is conducted at a large scale. From here, import and exports are done and prices are also fixed for this multipurpose commodity.

Trading of Cotton

The cotton is traded on NYMEX i.e New York Mercantile Exchange. It is a kind of a commodity exchange. The price fixation depends on the basis of market forces of demand and supply. The equilibrium between demand and supply is to be made otherwise it will result in the hoarding of that commodity, leading to losses. 

 

India has a long history in terms of commodity marketing. Cotton is also a commodity. In India it all started in the year 1875 i.e during the pre-independence era. In that year the very first Bombay Cotton Trade Association was established, with a view to increase trade with other countries and earn more profits. 

 

During the year 1900, Gujarati Vyapari Madi was set up. These mostly traded in futures and the commodities were cotton, castor seeds and groundnuts. During the year 1939, India banned the import and export of cotton, due to some unknown reasons. But the ban vanished when the British era expired in India.

 

This is how the cotton trading in India has come a long way since then. 

Cotton is typically useful for its fibre. Which is useful in textile raw materials all over the world. Cotton is a significant commodity in the world economy. Grown in more than 100 countries. Cotton is a massively trading agricultural commodity, with over 150 countries taking part in exports or imports of cotton. The six largest consuming countries are also among the top seven producing countries in the world. Cotton trade has accounted for about 30% of world output from 1980 through the 21st century, but this share has risen to almost 40% in the current decade.

 

As world cotton production unavoidably fluctuates from year to year, variations in supply can cause wide fluctuations in price. World cotton trade is not highly focused when compared to other commodities and their markets. About 500 major firms are involved in cotton exports worldwide.

 

Thus, it would be right to say that cotton really accounts for the largest traded commodity globally. Due to its multipurpose and multifunctional nature, it is useful worldwide and this will continue to happen.

Technological Influences on The Cotton Commodity Market

The long-run decline in real commodity prices is similar to technology emergence. The change has brought in agriculture, competition with substitute fibres and probably also to reduced prices for cotton products at the retail level. It will allow the use of electrical machinery in irrigation. The process of technology change is advancing and accelerating at a visible pace. According to the expert’s and even the general public opinion. The technology is going to bring a massive transformation in not only agriculture. But also specifically in the cotton commodity market.

 

Incremental advancements in proven technologies such as irrigation management, pesticide formulations and pesticide applicators, low-till and no-till production systems, crop rotations and other management techniques are also contributing to lower production prices and expanded cotton production. All of the technologies are being magnified by the revolution in information technology, making the potential for great improvements in management efficiency as well as productivity and control of input applications. The new technologies result in an enlargement of supply at each level of cotton prices, resulting in cheaper average prices. 

Cotton Commodity_ A Money Making Market

Following are some of the benefits that one can get from the cotton commodity market. These are as follows:

Market Information

You can get all the necessary information that is necessary for the trading by trading in the cotton commodity market. Otherwise it can be a bit more difficult to access that information.

Multipurpose Commodity

Cotton is a multipurpose commodity as well as a multifunctional commodity. Thus it has many benefits. It even yields a lot of profit too.

Economical

The production of cotton is economical. This means there is no need for large-scale and big investments. Thus it is easy for a person to grow cotton and trade in it.

Profitable Investment

Due to its multipurpose nature, cotton is one of the most profitable investments. It will give a boost to the economy too and overhead expenses will also not increase.

 

For more related information you can contact PL Global Impex Pte Ltd.

World map

Write With Us