China and United States Create Win-Win Relationship

T he American Cotton Shippers Association (ACSA) has maintained a long and valuable relationship with the Chinese industry going back to the early 1980s, when the primary buying agency for the Chinese textile industry was in the hands of Chinatex. This government agency acted as the procurement organization for their cotton supply outside of their local cotton production.
The terms of sale were dictated by the Chinatex rules or contract terms. ACSA leaders worked tirelessly and successfully for several years to negotiate the terms of the contract in order to make it a fair and equitable agreement for all parties.
During the 1990s – when the global industry and China both began to change, grow and expand – the purchasing of cotton changed in China as well. The Chinese government allowed and supported the privatization of the textile industry, moving from all government-owned plants to joint venture mills, and eventually went fully private. The amount of cotton being sold to China began to grow and the use of Chinatex terms continued, but further protection in trade rules and contract terms were required.
In 2003, during the ACSA annual meeting in Boston, then-ACSA President Bill Dunavant and incoming president Bobby Weil formed the ACSA/Amcot China Committee to negotiate with the new industry organization, the China Cotton Association (CCA), on terms for the trading of cotton.
After five years of work and numerous visits to Beijing for meetings, the terms were finalized and agreed-upon by all parties. The rules and contract are still viewed by ACSA/Amcot as a work in progress, mainly dealing with the quality differences and penalties within. CCA continues to work with us in trying to resolve these differences.
ACSA/Amcot also has been working very closely with the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) in China regarding quality claims and the availability of a quality claim appeal system. In these discussions, the U.S. Department of Agriculture-Agricultural Marketing Service has worked alongside us on in these efforts to further the harmonization of the cotton classing system in China. The International Cotton Association (ICA) contract is still heavily utilized by the trade in China.
ACSA/Amcot maintains a consultant in Beijing for on-the-ground representation for government relations and communications with CCA and other cotton- and textile-related entities.
Yuan Associates, a professional government relations firm, has represented the interests of the trade since 2004. The necessity to have representation within China became very apparent in early discussions about contracts and trade rule terms, and our relationship with Yuan Haiying and his staff has proven to be very helpful productive and highly professional.
ACSA continues its close and excellent working relationship with ICA and Cotton Council International, which are both integral partners in the cotton trade. Through these partnerships with our Chinese and international counterparts, there continues to be a strong business relationship that builds on communication and the sharing of ideas to benefit all involved in servicing the fiber needs of the largest textile industry in the world.