With world prices continued weak, farmers will as last year look to the government guarantee price, which is not enough to spur increases in area. Post estimates Vietnam 2006/07 cotton growing area at 23 tha, crop yield at 1.3 mt/ha and the crop production at 29.9 tmt of seed cotton, equivalent to 10.76 tmt of cotton fiber
PRICES
Domestic prices
The Vietnam Cotton Corporation (VCC) has been buying seed cotton at a guaranteed price of VND 6,000/kg ($.38/kg) since July 2005 when the price was raised from VND 5500/KG ($.34). VCC is selling local cotton fiber to textile mills at VND 19,500/kg. ($1.22/kg).
Import prices
According to Vietnam Customs Office, in the first quarter of 2006, the average import price of uncombed cotton fiber was $1.17/kg.. As can be seen in Table 4 this marks a modest increase in a price compared to last year but is still well below the price 2 years ago.
TRADE
According to the Vietnam Customs Office, in MY 20004/05, Vietnam imported 150 thousand metric of cotton fiber with a value of US$185 million or $1.20/kg.. Through the first 9 months of 2005/06 imports are comparable with the same period last year. The average import price has dropped to about US$1,15 /mt.
POLICY
Vietnam's Cotton Sector Reviewed
The Ministry of Industry has ratified a proposal submitted by the Vietnam Cotton Corporation (VCC) to review Vietnam's cotton sector. The main objective of the project is to develop a strategy for the cotton sector from to 2010 and 2020.
The project will provide appropriate policies to boost cotton production for import substitution and to create employment for farmers. France's International Development Fund (AFD) will give a grant of 331,700 Euros to VCC to implement the project.
United States Department of Agriculture FAS
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