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Import demand for cotton will remain positive
14 Jun '06
1 min read
Deutsche Bank Research (DB) announces that China is the world's largest producer of cotton it still has to import increasing amounts of the fibre to meet the demand of its textile industry.
Again, this is a case where the path of future demand is difficult to predict.
The textile industry is known to shift very quickly to lower-cost countries. Moreover, China's very large market share in textiles and clothes and increasing protectionist measures could become limiting factors as well.
On the other hand, China's supply of low-skilled labour remains vast, keeping wages in this sector relatively inexpensive compared with other countries.
It is therefore likely that although growth rates of the Chinese textile industry and thus for Chinese import demand for cotton will remain positive, these two forces could cancel each other out, so that growth of cotton demand might stabilise.
Click here to view news from Deutsche Bank Research.
Again, this is a case where the path of future demand is difficult to predict.
The textile industry is known to shift very quickly to lower-cost countries. Moreover, China's very large market share in textiles and clothes and increasing protectionist measures could become limiting factors as well.
On the other hand, China's supply of low-skilled labour remains vast, keeping wages in this sector relatively inexpensive compared with other countries.
It is therefore likely that although growth rates of the Chinese textile industry and thus for Chinese import demand for cotton will remain positive, these two forces could cancel each other out, so that growth of cotton demand might stabilise.
Click here to view news from Deutsche Bank Research.
Deutsche Bank Research
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