Who is killing the cotton farmer?

We are in the Aquarian age, the age of unpredictability. The hedging system we proudly create and boast off can not safeguard the very farmer, the first user of risk management. The farmer was the reason why we created the system in the first place.

In the past 18 months, 1200 cotton farmers of Vidarbha (Cotton Bowl of India) have taken their own lives to escape debts to money-lenders. Award winning markets, but we got late.

You can blame his illiteracy that he could not beat his fate. But political apathy only makes this one of the many events, that will miss the cover page. We are busy with more important essential talk of profit. The poor farmer did not understand the investment and took a safe bet steeping into a drought tolerant field crop. Global prices kept the supply pressure up to lead to the unfortunate incident.

But then you can not really hate COTTON, the fiber followed its natural rhythm as it headed down in a multi year C wave down. And just like every body loves equity now, the hate for the crop is also at an extreme. We at OR-PHE-US believe the worse times for cotton might be getting over. As no one wants to touch the asset at current prices. We have carried MCX Long Cotton here along with the Dow Jones Cotton Index. MCX cotton has broken a 15 month trendline and the Intermediate term still seems negative. While Dow Jones Cotton Index is finishing a multi year and a multi decade bottom. We anticipate supports coming in on the intermediate time frame soon enough. Till MCX Long Cotton does not cross above 18400, we expect a dip below 16400.

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