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The first definitive word on cotton production during 2007-08 - if the official estimate of 229 lakh bales is dismissed as unreliable - is out.

According to the Cotton Advisory Board (CAB), a representative body of all intimately associated with the cotton economy of India, including growers, mills, powerloom and handloom sectors, traders and ginners, the harvest is at an all-time high of 310 lakh bales, marking a jump of 30 lakh bales over the preceding year.

If the inventories of the previous season and imports during the current cotton year that runs from October to September are taken into account, the overall supply is projected at a comfortable 364 lakh bales.

On the demand side, CAB predicts an incremental growth of only about 12 lakh bales in the off-take by mills, while exports are slated to spurt by 7 lakh bales to 65 lakh bales.

After adjusting for the off-take by small mills and non-mill use, the current season is expected to end with a higher inventory of 54 lakh bales than last season’s 47.50 lakh bales.

Going by the CAB, cotton crop in the country has fared well, barring Punjab.

In Gujarat, the outturn is anticipated at 110 lakh bales as compared with the previous season’s 101 lakh bales. Maharashtra and Andhra Pradesh are looking at a rise of 8 lakh bales each to 60 lakh bales and 21 lakh bales, respectively.

In Madhya Pradesh, the size of the harvest is assessed at 21 lakh bales (18 lakh bales), in Karnataka at 8 lakh bales (6 lakh bales) and in Rajasthan at 9 lakh bales (8 lakh bales). In Tamil Nadu and Haryana, the output is pegged at last year’s level of 5 lakh bales and 16 lakh bales, respectively.

CAB says that in Haryana, though the crop area declined, a spurt in yield has helped the state stabilise production.

However, another major producing state, Punjab, is not so lucky. At 24 lakh bales, the 2007-08 crop in the state will be a good two lakh bales lower than in the earlier season, says CAB.

An indication that a bumper cotton harvest is in the offing has already been provided by the brisk pace of arrivals in the market.

By January 12, the arrivals had approximated to 174 lakh bales as compared with 147 lakh bales at this point a year ago. That is to say, arrivals are up by more than 18%. But, keen export demand has ensured that cotton prices, too, are ruling buoyant.

Most of the main varieties are quoted higher than their year-ago rates. An idea of the price behaviour can be obtained from the fact that the wholesale price index for raw cotton for the last week of December 2007 is 22% higher than a year ago.

Ironically, while the CAB estimates, based on consensus in a cross-section of the cotton economy, carry a high degree of acceptance, the same cannot be said of data issued by the ministry of agriculture.

For example, the first advance estimate issued by the government pegs the crop during 2007-08 at 229 lakh bales, just 2 lakh bales more than in 2006-07, while the CAB anticipates a leap of as much as 30 lakh bales to a record 310 lakh bales.

In fact, official figures have turned out to be gross underestimates of the actual trend in cotton harvest, with the divergence between the two quite pronounced in some years.

Worse still, occasionally, the annual change is in opposite directions, depending upon which projections we rely upon. For example, in 2001-02, whereas the CAB data revealed an increase of 18 lakh bales to 158 lakh bales, official estimates showed that the harvest, at 101 lakh bales, has suffered a setback to the tune of nearly 13 lakh bales.

The welter of conflicting estimates gives rise to avoidable confusion. It is time the CAB, which functions under the aegis of the Union textiles ministry, be designated as the sole agency for estimating the cotton crop because its exercise in this regard seems to be closer to reality. The need for the agriculture ministry to adopt the view of CAB needs no reiteration.