India's US cotton buying may slow as domestic supplies improve

By Noel John Oct 13 (Reuters) — India's US cotton purchases are likely to slow in the coming months as domestic supplies improve and uncertainty persists over a duty exemption set to expire at the end of the month, industry officials said. India's purchases from the US so far this year jumped 81% to 688,901 running bales (883,198 Indian bales), up from 380,641 bales during the same period last year, according to US Department of Agriculture data. The surge was fuelled by India's suspension of an 11% import duty on cotton, competitive US cotton prices, tighter domestic supplies of high-grade fibre and strong demand from export-oriented mills seeking contamination-free cotton. India, the world's second-largest cotton producer, earlier this year allowed duty-free imports until the end of October to boost domestic supplies. "When the landed cost of US cotton is competitive with the replacement cost of Indian cotton, mills have a strong incentive to diversify their sourcing," said Atul Ganatra, chairman and managing director of Shree Radhalakshmi Group and former president of the Cotton Association of India. Weaker monsoon conditions in India also supported imports, as mills look overse