Kapas, or raw cotton, is a key commodity in India, primarily grown in Gujarat, Maharashtra, and other states. Its seeds are used to produce cottonseed oil and cake, while the fibre is vital for yarn manufacturing and exports. Kapas trading units consist of 4 metric tonnes (200 maunds).
Introduction
Kapas, also known as raw cotton, plays a vital role in India's agricultural and industrial sectors. India is one of the largest producers of Kapas, with Gujarat, Maharashtra, and Andhra Pradesh leading production. Kapas is primarily grown during the monsoon season, with sowing in June-July and harvesting in October.
The fibre extracted from Kapas is essential for the textile industry, used in the production of yarn and fabric, with a portion exported to global markets. The seed, after extraction, is processed into cottonseed oil, widely used in cooking, and the by-product, cottonseed oil cake, serves as a valuable feed for livestock.
Kapas is a versatile commodity, essential in both the agricultural and industrial sectors, and is traded in large quantities. With increasing demand in the textile industry and for cottonseed oil, Kapas remains a vital commodity in India’s trade and economic growth.
Factors that Impact the Kapas Price
Here are some key factors that impact kapas market prices:
- Weather conditions: Weather at key stages like sowing, flowering, and harvesting directly impacts cotton yield and quality. Unfavourable weather conditions can reduce production and lead to price increases.
- Textile industry demand: As lint from Kapas is primarily used in yarn production, high demand from the textile industry drives prices up. This demand often fluctuates based on textile market trends.
- Government policies: Regulatory changes concerning kapas import and export can significantly affect supply dynamics. Stricter policies may restrict availability, while supportive measures can enhance market access, ultimately influencing price fluctuations.
- Demand for cottonseed products: The crushing industry utilises cottonseeds to produce oil and oil cake. Increased demand from this sector can raise the overall Kapas price.
- International cotton production: Global cotton production affects domestic Kapas prices. High international production may lower export demand, leading to price drops in the local market.
Things to Consider Before Trading in Kapas
Before entering the kapas trading market, it's essential to consider the crucial factors to make informed choices:
- Market research: Conduct thorough research on kapas market trends, including historical price patterns and demand fluctuations, to make informed trading decisions.
- Supply chain awareness: Familiarise yourself with the supply chain dynamics, including key producers and distribution channels, to better understand market influences and pricing variations.
- Understanding contracts: Familiarise yourself with trading contracts on platforms like NCDEX. Understand the terms, conditions, and delivery mechanisms to ensure a smooth trading experience.
- Regulatory compliance: Stay informed about relevant government policies and regulations related to kapas trading, including export-import duties and compliance requirements, to avoid legal issues.
- Price volatility: Be aware that Kapas prices can be volatile, influenced by global cotton production, domestic demand, and market conditions.
Kapas Expiry Date Calendar 2024
Contract launch calendar for kapas for the year 2024-25
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Contract Launch Month
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Contract Expiry Month
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November 2023
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November 2024
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February 2024
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February 2025
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April 2024
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April 2025
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November 2024
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November 2025
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February 2025
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February 2026
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April 2025
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April 2026
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How to Trade in Kapas via Angel One?
To trade kapas via Angel One, follow these steps:
- Open a Demat and Trading Account: First, open a Demat and trading account with Angel One.
- Activate the Commodity Segment: Once your Demat account is ready to trade, make sure you activate the commodity segment in order to trade kapas contracts and other commodities.
- Monitor the Market: Track exchanges like MCX (Multi Commodity Exchange) and NCDEX (National Commodity and Derivatives Exchange) to stay updated on live kapas prices, market trends, and relevant news.
- Place Your Trades: Use the Angel One trading platform and leverage indicators like Bollinger Bands, RSI, and MACD to build your commodity trading strategy.
- Manage Your Risk: To control your risk and guard against big losses on your trades, use measures like stop-loss orders.
