China to start Reserve Auctions this Month says ICAC
The Chinese government is expected to start sales from its cotton reserves on the sixth of this month and to continue offering around 30000 tons a day until the end of August 2017. More cotton may be put up for auction if sales are strong and market prices rise. Last year, around 2.6 million tons were sold through the end of September 2016
Assuming a similar volume is sold this year, the total volume held by the Chinese government will reach 6 million tons by the end of 2016/17. China’s total stocks, including those in the private sector, are forecast to reach 9.3 million tons at the end of 2016/17, accounting for 53 % of world stocks. World ending stocks are expected to decline by 7 % to 17.9 million tons in 2016/17.
In 2017/18, world cotton consumption is projected to exceed production by 1.2 million tons and stocks are expected to decline for the third consecutive season to 16.7 million tons. China’s ending stocks could fall by 19 % to 7.5 million tons, accounting for 45 % of world stocks at the end of 2017/18. This would mark the first season since 2011/12 that China’s stocks account for less than half of world inventories. World ending stocks outside of China are forecast to grow by 7 % to 8 million tons, which could place downward pressure on prices later this season.
Global cotton production is forecast to grow by 23.1 million tons on a planted area of 30.4 million hectares in 2017/18. India’s cotton production is projected to rise by 2 % to 5.9 million tons, as area expands by 7 % to 11.2 million hectares. China’s cotton production may increase by 2 % to 4.8 million tons, but will greatly depend on whether a subsidy is provided this year. While high cotton prices relative to competing crops is likely to lead to a large increase in planted area expected in the United States in 2017/18, production is forecast to rise by just 1 % to 3.7 million tons. Assuming normal weather patterns, the harvested area is projected to expand by 3 % to just under 4 million hectares. Pakistan’s cotton production is forecast to grow by 11 % to 1.9 million tons. Its cotton area is projected to expand by 3 % to 2.5 million hectares as high prices this season encourage farmers to plant, and the average yield may grow by 8 % to 736 kg/ha as the crop recovers from pest pressure.
After declining by 1 % to 24 million tons in in 2015/16, world cotton consumption is expected to remain stable in 2016/17. Given the strong demand this season and anticipated world economic growth in 2017 and 2018, world mill use is forecast to increase by 1 % to 24.3 million tons. China’s consumption and share in the world total declined continuously from 2010/11 to 2015/16, when it reached 7.4 million tons. While its mill use is forecast to grow by 2% to 7.6 million tons in 2016/17 and by 1 % to 7.7 million tons in 2017/18, its world share of cotton consumption is likely to remain at 30 %. Mill use in India is projected to decline by 3 % to 5.1 million tons in 2016/17, but is forecast to recover by 1 % to 5.2 million tons in 2017/18. Consumption in Bangladesh continues to grow due to strong textile exports, with its mill use likely to rise by 5 % to 1.5 million tons in 2017/18. Mill use in Vietnam has more than doubled in the last five years from around 500000 tons in 2012/13 to an expected 1.2 million tons in 2017/18.
World trade is expected to expand by 3 % to 8 million tons in 2017/18. China’s import volume is expected to rise by 11 % to 1.1 million tons in 2017/18 as its mill use continues to outpace its production. Bangladesh’s imports are projected to rise by 3 % to 1.5 million tons in 2017/18, while Vietnam’s imports are forecast to increase by 7 % to 1.24 million tons. The United States is expected to remain the world’s largest exporter and its volume is forecast to rise by 5 % to 2.9 million tons in 2017/18. Exports from India, the world’s second largest exporter, are projected to grow by 3 % to 990000 tons.
TextileFuture adds another source with information on China’s Cotton:
The National Development and Reform Commission of China announced late last year that China will offer 30,000 tonnes of cotton per day for sale until the end of August, as Beijing seeks to scale down its large, ageing stockpile.
• China will offer 30,000 tonnes of cotton per day for sale until the end of August, the National Development and Reform Commision announced late last year, as Beijing seeks to whittle down its large, ageing stockpile.