With cotton prices on a decline, textile mills in India are waiting for prices to stabilise to revive production.

Several textile mills that use cotton as raw material are operating at less than 50 per cent capacity at present because cotton prices went up to nearly Rs1 lakh a candy and are at nearly Rs70,000 a candy now. There are several uncertainties that mills are facing. Yarn movement is still slow and some mills have stocks too.

The mills are not sure of the price trend for yarn and the export demand. The hope is that things improve in November with better demand, especially international demand. Cotton prices are expected to stabilise atRs65,000 a candy. Cotton consumption is low now as prices are yet to stabilise and the mills do not want to buy the raw material at this juncture. Mills have started calibrating operations and many have started going in for blended yarn. Demand for cotton has, thus, reduced. Demand is expected to remain low for another month and when cotton prices stabilise mills will revive production.

The market has revived and festive season sales are expected to be good this year. This will result in higher demand for raw materials across the textile supply chain.