Cotton imports may rise this year, says CCI

Prompted by booming domestic consumption, China may import more cotton from the United States this year, said Karin Malmstrom, China director of Cotton Council International (CCI), the export promotion unit of the US National Cotton Council.

"According to one of our surveys, we are seeing a growing middle-class in China that is willing to pay more for cotton," Malmstrom said during a promotional campaign on Tuesday.

"We are very optimistic about China's retail market," she added.

As the world's largest buyer of cotton and soybeans, China has replaced Canada as the largest export market for US agricultural products, according to a report released by the US Department of Agriculture (USDA) earlier this month.

China bought 996,100 bales of cotton from the US two weeks ago, the largest weekly purchase in eight years, according to data from the USDA.

During the first nine months of the year, global cotton imports to China declined to 1.9 million tons, a fall of 9.7 percent year-on-year, according to data from China's General Administration of Customs. About half of those imports came from the US, according to Malmstrom.

"With the recent large purchase, the import market share for US cotton is expected to further expand," she said.

In reality, things may not be so straightforward. China's cotton imports depend largely on the health of its textile industry. More than 40 percent of China's cotton imports are re-exported as textile products every year, according to industry analysts.

And as the developed economies struggle with debt crises and high rates of unemployment, "Chinese textile companies are not very optimistic about the export market", said Gao Fang, executive vice-president of the China Cotton Association (CCA).

"In addition, China had a bumper cotton harvest this year, so it remains uncertain whether imports from the US will increase," Gao added.

Ma Wenfeng, a senior analyst at Beijing Orient Agribusiness Consultant Ltd, said the volume of cotton imports this year is likely to remain unchanged from last year.

"The price of cotton in the global market will remain stable for the time being, thanks to the worldwide harvest," he said.

China's cotton harvest this year is expected to jump by 9.3 percent from last year to 7.28 million tons, according to a CCA forecast in October.

In October, China imported 252,000 tons of cotton, practically unchanged from September, according to a statement on the CCA website.