By admin       2018-07-11

The detailed information about the additional import quotas has not revealed. If the cotton quotas are requested to be used before end Dec of this year, then what cotton can be supplied? During Jun and Dec, the cotton that will be arrived at Chinese ports is Australian and West African cotton (Jun-Oct), Brazilian cotton (Oct-Dec) and Central Asian and Indian cotton (Nov-Dec). Except Australian and Brazilian cotton, which is on arriving period, there may be outstanding orders to be concluded, for Indian, West African and Central Asian cotton, the sources have been signed contracts mostly, let alone the quality sources. Of course, in the USDA May supply and demand report, the ending stocks outside China in 2017/18 are supposed to rise 1.90 million tons (the increasing volumes in U.S., India and Brazilian cotton are 1.00 million tons), but the quality of remnant 2017/18 U.S. and Indian cotton is a problem. As the Indian cotton has no quality advantage compared with China’s Xinjiang cotton, with no obvious price edge, China reduces the imports of Indian cotton. For U.S. cotton, it is oversold. By May 31, sales of 2018/19 cotton have reached 1.06 million tons, about one third of the forecast exports. But there are more than 0.40 million tons of 2017/18 cotton left, the quality is considered to be not good. Therefore, international cotton supply in circulation tends to be tight in 2017/18 season. In Jun, the cotton crop sowing is virtually complete in North Hemisphere. Even cotton prices move up currently and profits increase, the plantings have ended mostly and the planting areas are not likely to change. Since May, the weather in Asia and U.S. is not favorable to the growing of cotton crops. The three largest cotton producers, China, India and U.S., estimate that the cotton output may decrease in 2018/19 season. The supply is likely to be relatively tight in 2018/19 season. International cotton prices are likely to maintain high, or even increase, leading to higher international cotton prices than domestic prices. 

Download App

# #

Member Login