Introduction

In September 2025, cotton farmers across North India—particularly in Punjab, Haryana, and Rajasthan—are facing a severe financial crisis. Due to heavy rainfall and crop damage, prices of unginned cotton (kapas) have fallen below the Minimum Support Price (MSP) in several mandis. The unexpected dip in market rates has left farmers struggling with losses at a time when they are already burdened with high input costs.

Cotton Price Trends in Mandis

According to mandi reports:

• The MSP for unginned cotton (2025-26 season) has been fixed at ₹7,121 per quintal by the government.

• However, mandi prices in several regions are currently ₹6,200–₹6,800 per quintal, significantly below the MSP.

• Traders attribute the fall to rain-hit arrivals, as moisture-damaged crops fetch lower bids.

This price crash has raised concerns about the income security of farmers and the effectiveness of procurement mechanisms.

Reasons Behind the Price Crash

1. Heavy Rainfall and Crop Damage

Excessive rains in Punjab, Haryana, and parts of Rajasthan have damaged cotton bolls. High moisture content reduces quality, forcing buyers to pay less.

2. Oversupply in Mandis

With rain-hit crops arriving in bulk, the sudden influx of supply has pressured mandi prices downward.

3. Weak Procurement at MSP

While MSP is declared, government procurement agencies have not yet fully started large-scale buying. This allows traders to exploit the situation.

4. Global Cotton Trends

International cotton prices have also been under pressure due to improved production forecasts in the U.S. and Brazil, further impacting Indian markets.

Impact on Farmers

The fall in cotton prices has created multiple challenges for farmers:

• Loss of income: Many are selling below MSP, directly losing ₹500–₹900 per quintal.

• Debt burden: Farmers who invested heavily in fertilizers, pesticides, and irrigation are unable to recover costs.

• Delayed sowing of next crops: Financial stress may reduce their ability to invest in wheat and mustard sowing later this year.

• Mental health strain: Cotton is a cash crop, and sudden losses often trigger distress among farming communities.

Government Response

• The Cotton Corporation of India (CCI) has been urged to immediately step up procurement at MSP to stabilize prices.

• State governments are considering compensation packages for rain-hit farmers.

• Farmer unions have staged protests, demanding timely intervention to prevent further exploitation.

Expert Insights

Agricultural experts believe that unless procurement begins swiftly, mandi prices may remain below MSP for several weeks. They also highlight the need for:

• Stronger crop insurance coverage against rain damage.

• Modern storage facilities to reduce distress sales.

• Market reforms to ensure fair competition and transparency.

FAQs

Q1. What is the current MSP for cotton?
The MSP for unginned cotton (2025–26 season) is ₹7,121 per quintal.

Q2. Why are mandi prices below MSP?
Due to rain damage, poor quality arrivals, oversupply, and weak procurement, mandi prices are currently below MSP.

Q3. Which states are worst affected?
Punjab, Haryana, and Rajasthan are reporting the sharpest fall in cotton prices.

Q4. What is the role of CCI?
The Cotton Corporation of India (CCI) is responsible for procuring cotton at MSP to protect farmers from losses.

Q5. What can farmers do to cope?
They are urging government procurement, compensation, and insurance payouts, while farmer unions continue to protest for immediate relief.

Conclusion

The ongoing price fall in unginned cotton across North India has once again exposed the vulnerabilities of the country’s agricultural economy. Farmers, who are the backbone of India’s cotton industry, are being forced to sell below the government-declared MSP due to rain damage and weak procurement systems.

Unless swift action is taken by agencies like the CCI, farmers’ distress will only deepen, threatening not just their livelihoods but also the future of cotton production in India.