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Cotton supply expected to be tight in 2010
Mar '10
A recent report released by China's National Bureau of Statistics reveals that cotton cultivation area stood at 4.95 million hectares in the current cotton year, a reduction of 0.80 million hectares from the previous year, while, cotton production touched 6.4 million tons, down 14.6 percent from the previous cotton year.

The United States Department of Agriculture lowered US cotton stocks in its February report released on February 8 and adjusted cotton consumption in China to 10.34 million tons this year. The market therefore expects that China's cotton supply will be tight this year.

As exports from the textile sector, declined due to the financial crisis in the first half of 2009, China in total, imported 1.5977 million tons of cotton last year, down 27.0 percent year on year. However, China's cotton imports showed rapid growth by the end of last year.

China imported 229,000 tons of cotton in December 2009, up 103.0 percent from the previous month, According to customs statistics, China's cotton imports in January this year reached 311,000 tons to set another record.

China's annual yarn production was 24.06 million tons in 2009. Considering that 50 percent of this yarn was cotton yarn, domestic cotton consumption would have been about 12 million tons. This quantity was roughly equal to the sum of cotton production, imports and inventories last year.

But since cotton acreage shrank in 2009, leading to a shortfall in production, cotton supply available to domestic cotton textile industry in the first several months before new cotton comes in to the market in the second half of 2010, will be severely constrained and cotton supply position is expected to worsen in second half of 2010.

Fibre2fashion News Desk - China

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