Halt in Indian Exports Could Push China to U.S. Cotton
May 4, 2010 Bloomberg News
China, the world’s largest cotton user, faces an imminent cotton shortage after India halted exports and demand climbed, the State-owned Assets Supervision and Administration Commission said last week.
“We will have to turn to U.S. cotton after India’s decision to halt exports, but that’s still not enough,” Yuan Renqing, analyst at Xinhu Futures Co., said by phone from Qingdao.
The deficit will be about 1.4 million bales before the new crop comes onto the market, the agency said in a report, citing the China National Cotton Reserves Corp. The deficit calculation has taken into consideration the quantity China needs to import and the available global supply, it said.
India, the world’s second-largest cotton grower, halted exports last week to boost domestic supplies and cool prices. China’s economic growth of 11.9 percent in the first quarter is spurring textile consumption while cotton output last year shrank on reduced planting.
Chinese consumption may outstrip available supply by 16 million bales in the marketing year ending August 31, and supply will remain tight next year, Mei Yong, an analyst at state- backed CNCotton.com said April 16. China’s cotton year runs from September to August.
Demand is recovering as China’s cotton yarn output jumped 20 percent in the first quarter as factories increased production on improving exports, the China Cotton Association said on April 23.
(Story found in original format here.)
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