Cotton imports slid 44.9 percent year-on-year to 161,200 metric tons in January, highlighting the challenges that domestic textile manufacturers face in a weak world market, said trade experts. He Jingtong, a professor of international trade at Nankai University in Tianjin, said that slack global market conditions have hit China’s labor-intensive industries, especially garment and textile production, as well as shoes, toys and furniture. All these exports slumped in January, underscoring the nation’s fast-fading advantage in some of the sectors it once dominated…Full Article: China Daily Feb 2015

Key Points

  • In 2014, Chinese cotton reserves reached 11 million MTs, equal to roughly half of global cotton trade volumes.
  • In September 2014, China announced that would not increase its cotton import quota beyond 894,000 MTs for 2015.
  • In mid-2011, developed markets began curtailing their imports of Chinese-made clothing and yarn products.

ChinaAg Comments

  • In September 2014, the Chinese domestic price for ginned cotton totaled CNY 14,000 (~US$ 2284.50) per metric ton. At the same, in the US futures markets, the price of ginned cotton stands at approximately CNY 11,800 (~US$1,925.50) per MT.
  • In April 2014, China’s NDRC announced it would abolish the minimum purchase price for cotton and instead would set CNY 19,800 (~US$3,224) per MT as the reference price. If the free market price falls below the reference price, then farmers will receive a subsidy based on the quantity of cotton sold in February 2015.
  • In 2013, China produced 6.2 million MTs of cotton, a decline from the 6.8 million MTs recorded in 2012. In 2013, Xinjiang accounted 56% or 3.5 million MTs of Chinese cotton production. The next largest producer was Shandong which accounted for 10% (620,961 MTs of output).

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