Bangladesh has emerged as the biggest importer of Indian cotton this season. It imported around 21 lakh bales of cotton from India overtaking China, which was largest importer of Indian cotton until now. For many seasons, China has remained the largest importer of cotton from India and has imported around 17-18 lakh bales during any given season. However, for the past couple of seasons, China has not been importing much cotton because of large reserves of the crop within the country itself. In the last two seasons, China has imported some 19 lakh bales of cotton. Bangladesh, on the other hand, has imported around 36 lakh bales during this period. According to industry people, there have been no restrictions on the import of cotton in Bangladesh.Cotton is exported from India via Kolkata port and the road route from Benapole. Traders say that expenses on logistics are reduced since Bangladesh in India’s neighbour.
Bangladesh produces less than 8 lakh bales in a season and is not considered a significant cotton producer. Over 90 % of the country’s textile mills’ needs are met through imports. The country has over 85 textile mills and a large presence in powerloom and processing. The country’s textile business has 35% foreign direct investment, industry sources said. Both US and China are large investors in the textile business. US exports around 25-28 lakh bales.
The Cotton Association of India (CAI) has estimated domestic consumption at 324 lakh bales while the exports for the season are estimated at 65 lakh bales which is higher by 5 lakh bales than the CAI’s estimate of the previous month as the country is now witnessing a good export demand. The carry-over stock at the end of 2017-18 season is estimated by the Association at 21 lakh bales, which is lower by 1 lakh bales of 170 kgs each than the CAI ‘s earlier estimate. Several new textile mills have come up in Gujarat and other states have started operations resulting in about 35 lakh new spindles this year. India is also the second largest exporter of cotton in the world next only to the US and it also has a vibrant import market.
So far, India has exported 15 lakh bales of cotton to China. As per data provided by CAI, the country has contracted 15-20 lakh bales for exports to China. Following the trade war with the US, China has imposed tariffs on import of cotton from the US. Cotton is one of the 106 US goods on which Beijing has imposed up to 25% tariffs. Atul Ganatra, President, Cotton Association of India (CAI), had earlier said India has been receiving demands for cotton from several other countries, including Vietnam, Indonesia and Turkey. According to the CAI, India had exported 63 lakh bales of cotton last year. Each bale has nearly 170 kg of cotton.
Sourcing cotton from India is more cost effective and less expensive in comparison to other countries, according to traders. India has already shipped nearly 53-55 lakh bales in the current season and contracts have been signed for another 8-10 lakh bales scheduled for shipment in April-May.India will export 65-70 lakh bales of cotton in the ongoing cotton season 2017-18 (October-September) amid aggressive demands from neighbouring countries like Bangladesh, Pakistan and China, according to traders.
The country’s cotton exports would reach 65 lakh bales by May-end as Bangladesh, the world’s largest cotton importer, does not have much of its own production and its spinning mills largely depend on imports, CAI has said. In the early six months of this cotton production and marketing season 2017-18 (October-March), India had sold 55 lakh bales of cotton, of which 17 lakh bales were shipped to Bangladesh followed by 11 lakh bales to Pakistan, 10 lakh to Vietnam, 7 lakh to China, 7 lakh to Indonesia and Taiwan, and 3 lakh to other countries including Sri Lanka, Turkey and Thailand, among others.
Source: financialexpress.com