Home / Knowledge / News / Textiles / Global Stocks & Chinese policies influencing cotton prices
Global Stocks & Chinese policies influencing cotton prices
03
Aug '12
In 2011/12, the considerable increase in global cotton stocks combined with declining mill use triggered a significant decline in international cotton prices. The Cotlook A Index averaged $1.00 per pound in 2011/12, down by 39% from its record of the previous season. Exceptionally high cotton imports by China (5.2 million tons) triggered by domestic policies were the main factor preventing a more pronounced fall in international prices.

Most of the considerable gain in global cotton stocks in 2011/12 took place in China: its stocks almost tripled to 6 million tons while in the rest of the world they increased by only 5% to 7.6 million tons.

Following the plunge in cotton prices in 2011/12, world cotton production is forecast down by 9% to 24.7 million tons in 2012/13. Global cotton mill use is projected to increase only slightly to 23.2 million tons, as the rate of global economic growth is expected to remain slow and because the high domestic cotton support price in China is encouraging mills there to shift toward alternative fibers.

In 2012/13, the resulting excess supply of 1.6 million tons will cause global stocks to rise by 11% to 15.2 million tons. In contrast with 2011/12, stocks could accumulate at a faster rate outside of China. However, the Chinese government announced a slightly higher minimum support price for 2012/13 and is expected to buy a large portion of the new cotton crop. This suggests that the size of the Chinese national cotton reserve may continue to increase, even if the government rotates some of its old stocks during the season.

Assuming much lower imports by China in 2012/13 (2.6 million tons), global cotton trade is expected to fall by 20% to 7.5 million tons in 2012/13. However, imports by countries other than China could grow, driven by lower cotton prices and a slightly higher level of consumption.

The projected accumulation of cotton stocks will weigh on international cotton prices in 2012/13, but the extent of this downward pressure will depend in large part on how the Chinese national reserve is handled and on the timing and amount of additional import quotas.

The International Cotton Advisory Committee (ICAC) is an association of governments of cotton producing and consuming countries. The Secretariat of the Committee publishes information related to world cotton production, supply, demand and prices, and provides technical information on cotton production technology.

International Cotton Advisory Committee (ICAC)


Must ReadView All

Textiles | On 27th Jun 2017

Govt defers tax deduction at source provision under GST

E-commerce players in India will not be required to deduct tax on...

Apparel/Garments | On 27th Jun 2017

Future Group aims Rs 12,000 crore in fashion business

Future Group, which runs retail stores across India under various...

Textiles | On 27th Jun 2017

AEPC & NSDL to help exporters with GST compliances

Apparel Export Promotion Council (AEPC) and National Securities...

Interviews View All

Asim Dalal
Indo Count Retail Ventures

Today, there is no other emerging market as India, "we make in India and...

Krishnanand Tripathi
Textrade International Ltd

We believe in vocational education for entry-level employees, offering...

Prabu Mohanram
Balavigna Weaving Mills Pvt Ltd

The biggest challenge that the weaving industry faces is high price

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Pranav Mishra
Huemn

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
July 2017

July 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search