CCI plans to acquire 7.17 hectares of barren land of NTC on lease for which a formal proposal has already been submitted to BIFR

The public sector the Cotton Corporation of India (CCI), which carries out market intervention activities to support cotton farmers, has signed a memorandum of understanding (MoU) National Textile Corporation (NTC) to set up a ginning cum pressing (GNP) mill in Seemandhra, the newly formed Talangana state.

CCI plans to acquire 7.17 hectares (ha) of barren land of NTC on lease for which a formal proposal has already been submitted to the Bureau of Indian Financial Reconstruction (BIFR), being the land a part of NTC’s closed unit.

“We procure around 100,000 tonnes of cotton in this area out of its total production of around 400,000 tonnes. Hence, cotton would adequatly be supplied to our forward integration unit. Initially, we are looking at 60,000 tonnes of pressing and ginning capacity of this plant,” said B K Mishra, chairman cum managing director of CCI.

Apart from that, the company plans to set up a warehouse to store cotton with 100,000 tonnes of storage capacity.

The company has earmarked investment of Rs 20 crore for these projects from its current networth of Rs 250 crore.

CCI is looking to set up this plant initially on pilot basis which, on being successful, will be expanded for commercial basis and other neighbouring states also provided the state government allocates free land.

The company which also executes commercial cotton trade, has urged the government seeking expansion in procurement area including jute and other agricultural commodities similar to Nafed.

CCI procured 441,000 tonnes of cotton so far this year of which around 90 per cent was for commercial operation. The remaining 10 per cent to the tune of 40,000 tonne of cotton was procured under market intervention scheme.

“We get an opportunity to procure huge quantity of cotton at the minimum support price (MSP) once in four years. In the remaining period, therefore, we execute commercial cotton procurement. Forward integration would certainly help us taste the market and set a benchmark for yarn and fabric industry in India,” said Mishra.

source: http://www.business-standard.com / Business Standard / Home> Company> News / by BS Reporter / Mumbai – July 24th, 2014