China’s Cotton Demand Outpaces Domestic Production
September 27, 2010 Bloomberg
Demand for cotton in China, the world’s largest buyer and grower, outstripped domestic production by 16.5 million bales in 2009/10, widening a supply deficit, the China Cotton Association said Monday, September 27.
The gap increased by 11.9 million bales from the previous year, the group said, citing Zhang Xiaoqiang, deputy head of the National Development and Reform Commission.
“A recovery in the textile industry coupled with a drop in production because of lower income from cotton planting has resulted in a relatively big change in the demand and supply balance,” the association said, citing Zhang in a government meeting on cotton.
China’s domestic cotton production fell by 14.7 percent to 29.33 million bales in the year ended August 31, Zhang was quoted as saying. Yarn production expanded by 16.6 percent in the same period to 26.41 million tons, driving a total demand for cotton to 48.58 million bales, he added.
China has sold the natural fiber from government stockpiles in auctions to bridge the supply gap, offloading 5.04 million bales during September and December and another half million bales between August 10 to -31, Zhang said. The country’s cotton imports jumped 73 percent from a year ago to 11.5 million bales.
Standard cotton prices in China have climbed 29.3 percent in 2009/10 to an average 15,724 yuan ($512 per bale) a ton, pacing the gain in the international cotton market, the report said.
China will auction a further 1.37 million bales to bales 1.83 million from state reserves to satisfy demand from the textile industry, industry researcher cncotton.com said yesterday in a report.
The country will release the additional cotton following a decision to sell 2.75 million bales starting August 10, the report said.
GET THE NEWSLETTER TODAY!
