China, world's largest cotton producer, importer, and consumer; dominates the global cotton market with the world's highest beginning stocks. Any changes in China's cotton market situation directly affect the global cotton market. Find below the percentage share of China in the global cotton market

As per world's cotton supply and demand figure, in the cotton crop year 2014-15, China had 61% of global cotton stocks. Majority of the world's cotton stocks existed in China, which is a key factor in increasing China's impact on the global price trend. Being the world's largest cotton producer, China produces almost one fourth of the global cotton production.

At the same time, as the world's highest cotton importer, China imported almost 24% of the total world's cotton imports in the cotton crop year 2014-15. In fact, in the cotton crop year 2014-15, China imported only 8.25 million 480-pound bales, which is almost one third of the cotton imported in the cotton crop year 2011-12, i.e. 24.53 million 480 pound bales.

The sudden spurt in 2010-11 (the highest import figure in China till now) was the result of China's Cotton Reserve Policy announced by the Chinese government.

In 2010-11, global cotton prices broke all its records by reaching an all-time high of 243.65 US cents/pound on 8th March, 2011. The world's cotton price boost was the result of a long gap between supply and demand in China. Comparatively, lower cotton production in China than the capacity of its spinning mills contributed to the record prices.

At the same time, when global cotton prices hit its highest peak, China government announced a policy to control the Chinese cotton acres. This policy comprised of guaranteed prices imposed by the China Cotton Reserve System and control over the cotton import figures.

As an after-effect of this policy, global cotton prices came under control and started moving south ward. But on the other side, global cotton beginning stocks were restored, and started increasing every year and reached a record level. In the meantime, Chinese cotton prices stayed on the higher side and floated near the Chinese government's guaranteed prices.

In April 2014, the Chinese government made some changes in its Cotton Reserve Policy by ending its almost 3-years extended drive of stocking the raw cotton to support their farmers by buying their crop at guaranteed prices. As an alternative, the government decided to give subsidies directly to its growers.

As a result of the Chinese government's policy amendment and decision of offloading its reserve cotton stockpile, the Chinese spinning mills started getting raw cotton at cheaper prices from the local market itself. The Chinese textile mills minimised their import of cotton and cotton yarn. China, which is the world's largest cotton yarn importing country, also impacted the global cotton yarn market very badly. Due to the availability of Chinese cotton yarn at comparatively lesser prices than the world's other markets, export volume took a historic jump.

As per the latest customs data published by China Cotton Association, cotton imports by China continue to show downtrend. In June 2015, China's cotton imports stood at 161,800 tons, down 25.9% year-on-year and 0.8% month-on-month basis. In the period of six months from January to June 2015, China's total cotton imports declined by 33% year-on-year, i.e. 933,900 tons.

During the first ten months of the ongoing cotton season, beginning from September 2014, China imported a total of 1.495 million tons, down 40.6% compared to the corresponding period of the previous season.

Analysts attribute the drop in Chinese cotton imports to the lack of import quotas and relatively high international prices. The Chinese government has only issued 894,000 tons of import quotas this year, which is the minimum required under the country's WTO commitments.

On the other hand, the price difference between cotton from other countries and domestic cotton is narrowing down and textile mills do not find importing cotton attractive, which resulted in obvious fall in international market prices in the absence of demand from both domestic and international market.