US cotton farmers make hay, while China foots the bill
10 Sep '10
2 min read
Cotton price has increased by as much as 2,000 Yuan, in a short span of one and a half months, and now the price stands at record high of above 18,000 Yuan / ton. Analysts point out that, US cotton farmers have harvested most profits, while Chinese textile enterprises foot the bill.
In the recently conducted cotton reserves auction, when converted in to prices of grade 328 cotton, they stood at a record high of 18,398 Yuan / ton on September 1.
Along with release plan of 600,000 tons of cotton reserves, of which almost 50 percent has been completed, the country is also importing high volumes of cotton, mainly from the US.
Customs statistics reveal that China's total cotton imports reached 1.712 million tons from January to July this year, an increase of 847,000 tons year on year, representing a growth of 97.6 percent.
As of July, China's total imports in the 2009-10 cotton year, achieved 2.265 million tons, an increase of 927,000 tons or 69.4 percent year on year.
China's cotton imports are expected to grow 29 percent to 3.1 million tons in the new 2010-11 cotton season, said the Secretary-General of the International Cotton Advisory Committee (ICAC), in his latest monthly report.
The US cotton farmers stand to gain the most from increase in prices. The ICAC expects that, US cotton production will increase by 52 percent to four million tons and its cotton exports will significantly increase by 27 percent, due to which the American cotton farmers are expected to earn nearly US $10 billion more from increased exports and prices.
marketing@alchempro.com
