Indian cotton farmers are struggling as duty-free cotton imports flood the market. Prices are falling below the government’s Minimum Support Price (MSP). Many farmers are forced to sell their cotton to private buyers for less than the MSP. The government had set the MSP for medium-staple cotton at ₹7,710 per quintal and for long-staple cotton at ₹8,110 per quintal for the current marketing season (2025-26). However, market prices are currently between ₹6,500 and ₹7,000 per quintal in major producing regions like Rajasthan, Punjab, Haryana, and Gujarat. This is happening as the new cotton crop is arriving in markets. Daily arrivals are between 80,000 to 90,000 bales. The government’s agency, the Cotton Corporation of India (CCI), is also facing issues. It has unsold stock from the previous season and has not yet finalised contracts with ginning units for the current season’s procurement. The government allowed duty-free cotton imports in September and extended this period until December 31, 2025. This decision has caused cotton prices to drop significantly. CCI is now pressured to sell its old stock, even at reduced prices, to make space for new purchases. The procurement cost for CCI for the new season is estimated to be around ₹61,000 per bale, while the market price is much lower, between ₹51,000 to ₹52,000 per bale. Imported cotton is also available at these lower market prices. CCI reportedly has about 2.3 million bales sold but not yet lifted. A large portion of this was bought by traders. On top of this, CCI has an unsold stock of around 1.3 million bales. To buy new cotton, they need to clear this old stock, likely at a loss. There are also concerns that ginning mills might be delaying contracts with CCI, possibly due to a cartel aiming for higher rates. This whole situation directly impacts farmers, who are already facing challenges. Cotton cultivation area has reduced by about one million hectares this year. Farmers are suffering due to diseases, pest attacks, and now, low prices for their produce. Cotton production has dropped from 398 lakh bales in 2013-14 to 306 lakh bales this year. Interestingly, the cotton industry, which previously called for imports due to lower production, is now reporting an increase. There are fears that traders might try to sell cotton bought below MSP back to CCI at MSP rates. More than 4 million bales of duty-free imported cotton have already arrived, and this figure could reach 5 million by the end of December 2025. The duty-free import policy is hurting farmers and potentially causing financial losses for the government through CCI’s forced sales below cost.