May 9, 2012

China's March cotton imports almost hit record level

In the season which has just ended, China's cotton imports have almost doubled - with March imports placing as the next highest in record, basing on official figures.

The China Cotton Association says imports rose 86.6% in the seven-months from September to the end of March, reaching 3.241 million tonnes.

The surge is the result of government efforts to build national stockpiles in an effort to ensure domestic cotton supplies and help avoid future fluctuations in cotton prices.

In March, China imported 625,000 tonnes of cotton, a rise of 1.5% over February, and 126.1% higher on-year. The average import price was US$2,330 per tonne, which was 24.8% lower than in the same month last year.

China is the biggest user of Indian cotton, but a decision by the Indian government earlier this year to restrict its cotton exports meant India's share of the total fell to below 50% in March. Earlier in the season China had taken around 85% of India's total cotton exports.

In terms of other source countries, the US continued to recover and accounted for one-third of total imports, Australia saw a "'slight increase"', while India, Brazil and Uzbekistan "'declined a little."'

Inter-governmental group the International Cotton Advisory Council (ICAC) most recently forecast that a surge in cotton imports into China is set to boost global cotton trade this season, and is also likely to keep cotton prices low.