Greece
Cotton and Products Annual
2018
Approved By: Fred Giles
Prepared By: Dimosthenis Faniadis
Report Highlights:
Greece is the EU’s main cotton grower, accounting for more than 80 percent of total European production. In MY 2017/18, cotton production is estimated at 1.24 million bales, up 20 percent from the previous season due to favorable weather conditions during harvest and good yields in the major cotton growing areas. Greece is a major cotton exporter. Turkey was the main destination in MY 2016/17, accounting for approximately 36 percent of all exports.
Production:
Cotton Lint
Table 1: Production, Supply, and Demand (1000 480 lb. Bales)
| 2016/2017 | 2017/2018 | 2018/2019 | ||||
| Cotton
|
Market Year Begin: Aug 2016 | Market Year Begin: Aug 2017 | Market Year Begin: Aug 2018 | |||
| USDA
Official |
New
Post |
USDA
Official |
New
Post |
USDA
Official |
New
Post |
|
| Area Harvested | 200 | 210 | 250 | 230 | 240 | |
| Beginning Stocks | 152 | 152 | 120 | 120 | 95 | |
| Production | 1,033 | 1,033 | 1,240 | 1,240 | 1,250 | |
| Imports | 27 | 27 | 25 | 25 | 23 | |
| Total Supply | 1,212 | 1,212 | 1,385 | 1,385 | 1,368 | |
| Exports | 1,022 | 1,022 | 1,100 | 1,170 | 1,170 | |
| Use | 70 | 70 | 90 | 95 | 95 | |
| Loss | 0 | 0 | 0 | 25 | 25 | |
| Total Dom. Cons. | 70 | 70 | 90 | 120 | 120 | |
| Ending Stocks | 120 | 120 | 195 | 95 | 78 | |
| Total
Distribution |
1,212 | 1,212 | 1,385 | 1,385 | 1,368 | |
| (1000 HA), 1000 480 lb. Bales | ||||||
Source: FAS estimates based on Greek industry contacts
Greece is the EU’s main cotton grower, accounting for more than 80 percent of total European production. Cotton is a crop of high importance for Greek agricultural production, accounting for more than 8 percent of total agricultural output. Thessaly, Macedonia, Thrace and Mainland Greece are the major cotton-producing areas. Cotton in Greece is planted from March 1 to April 15 and the crop life cycle is usually 170 to 210 days, depending on the variety and weather conditions. The harvest normally occurs from October 1 to November 30, and most of the cotton is machine harvested.
Greece’s MY 2017/18 cotton production is estimated at 1.24 million 480 lb. bales, up 20 percent from the previous season due to favorable weather conditions during harvest and good yields, which are expected to be higher than last year in the major cotton growing districts of Thessaly and Macedonia. MY 2017/18 cotton acreage increased 9.5 percent, registering 230,000 ha, at the expense of durum wheat and corn acreage. Rains in late September have delayed the harvest of early varieties but favored the quality and yield in Central Greece, thus this year’s quality is expected to be very good. Greece’s MY 2018/19 cotton area is forecast to increase by 4.3 percent after a fairly good campaign last year in terms of yields and prices. Greek farmers saw the seed cotton farm-gate prices delivered to Thessaly ginning units vary from 0.49 €/kg up to 0.53 €/kg in November 2017, approximately 12 percent higher than the previous year.
The Ministry of Rural Development and Food granted cotton farmers two special exemptions for plant growth regulators, and three for acaricides, for use during the period between July and December, 2017.
Greek ginning companies have a high production capacity, as most of the ginning units were built in the
90’s, but cotton production has significantly decreased since then. Nearly 80 percent of the companies are privately owned while the remainder are cooperatives. Greece’s financial crisis has negatively affected the cotton market, creating greater risk and uncertainty. Without help from the banks many ginners and cooperatives are unable to store their stocks with current market prices. There is also debate concerning the survival of cooperatives that accustomed to receiving large agricultural loans that are no longer available. Ginners generally do not contract with growers but compete with each other to purchase the crop.
Consumption:
Domestic spinners consume approximately 10 percent of lint production and the remainder is exported. The supply of ginned cotton is fragmented, since even the largest enterprises cover only a small part of domestic production. Most production units are involved in intense export activity, selling their products to foreign markets. About 55 percent of cottonseed production is crushed for oil and oilseed cake or retained for seed. The cottonseed oil is traditionally used in foods and the snack-food manufacturing industries or converted into biodiesel.
Trade:
Greece is a major cotton exporter. Cotton lint exports during MY 2015/16 fell by 17.6 percent driven by reduced production and lower quality. Turkey was the main destination, representing 52 percent of total exports, followed by Egypt (20.8 percent), and Indonesia (8.9 percent). Cotton lint imports increased 49.2 percent during MY 2015/16 to compensate for reduced cotton production, but generally only small amounts of cotton are imported for blending by the domestic spinning industry.
Table 2: Cotton Lint Exports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 50,311 | 24,898 | 52,043 |
| Germany | 11,243 | 10,770 | 19,607 |
| Italy | 17,637 | 3,647 | 13,467 |
| United Kingdom | 5,438 | 3,720 | 7,542 |
| Bulgaria | 9,025 | 6,655 | 4,873 |
| Extra EU-28 | 1,114,643 | 934,471 | 970,328 |
| Turkey | 587,059 | 499,177 | 364,589 |
| Indonesia | 142,685 | 85,622 | 176,668 |
| Egypt | 200,226 | 199,964 | 152,969 |
| Vietnam | 17,908 | 795 | 71,145 |
| China | 19,708 | 0 | 63,737 |
| Bangladesh | 8,965 | 8,318 | 42,889 |
| World | 1,164,954 | 959,369 | 1,022,371 |
Source: GTA (Global Trade Atlas)
Table 3: Cotton Lint Imports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 4,575 | 4,492 | 7,188 |
| Bulgaria | 0 | 2,255 | 3,922 |
| Spain | 4,441 | 2,076 | 1,975 |
| Germany | 110 | 110 | 1,258 |
| Extra EU-28 | 13,875 | 23,025 | 19,764 |
| Turkey | 7,799 | 15,226 | 12,897 |
| India | 3,950 | 4,556 | 3,128 |
| Pakistan | 845 | 1,649 | 1,888 |
| World | 18,450 | 27,521 | 26,952 |
Source: GTA
Policy:
The future of the cotton sector in Greece is strictly related to the subsidy scheme and how CAP reform is implemented. Starting in 2015, the new CAP amended Greek farmers’ historical rights, determining that should a farmer not cultivate more than 50 percent of their land they would not qualify for aid. In order to link Greece with the Europe 2020 strategy for smart, sustainable and inclusive growth, the
European Commission organized an extensive public outreach effort to develop the new CAP in Europe. The radical change in the orientation of the CAP is demonstrated by the evolution of expenditure away from product based support towards producer support and considerations for the environment. The current CAP is greener and, in theory, aid is more equitably distributed under the first pillar, which describes direct payments to farmers. The direct support arrangements mark a shift from ‘decoupling’ to ‘targeting’, meaning decoupling aid has been replaced by aid which is linked to specific objectives. From 2014 onwards, the allocation of direct payments dedicated to coupled support depends upon the choices made by Member States. The crop-specific payment for cotton is a coupled payment granted per hectare of eligible area of cotton. The area is only eligible if it is located on Greek agricultural land authorized for cotton production, sown with certified varieties and actually harvested under normal growing conditions. Additionally, the Ministry of Rural Development and Food publishes an annual list in the Government Gazette that sets the minimum amounts of cotton delivered to the ginners in order to receive the subsidy. Three categories of producers are identified according to the size of the land cultivated: cotton producers with less than 10 hectares; cotton producers with 10-15 hectares; and cotton producers with more than 15 hectares. Producers with less than 10 hectares receive the basic area payment (70 percent) and a green aid (30 percent). Producers that cultivate an area from 10-15 hectares need to follow different rules to obtain the green aid. These farmers must cultivate at least two crops and the main crop cannot exceed 75 percent of the total cultivated area. Producers with more than 15 hectares must also maintain an “ecological focus area”, equivalent to at least 5 percent of the total arable area of the farm. The ecological focus area can be cultivated with alfalfa, legumes, vetch (Vicia sativa plant), or left uncultivated. The second pillar is focused on increasing competitiveness and innovation and managing climate change and the environment. Its purpose is to set the EU’s rural development policy. The future of Europe’s post-2020 agricultural policy is currently being discussed specifically focusing on direct payments, environmental measures, and rural development.
Textile products
According to the Hellenic Association of Textile Industries (SEVK), the Greek textile industry has been suffering from increased third-country imports (mainly from China, Pakistan, and India). This has affected the sector in Greece, forcing many small Greek companies to shut down. As a consequence, the sector has shrank approximately 70 percent compared to the 80’s, with a high unemployment rate. According to the Hellenic Fashion Industry Association (SEPEE), the economic crisis has also affected the textile manufacturing industry. In 2016, the fashion industry business turnover increased by 1.5 percent compared to the previous year. Cotton yarn exports in MY 2016/17 decreased by 4.6 percent, mostly due to decreased exports to Italy and Spain, while imports decreased 8.9 percent with the main suppliers being Turkey, Bulgaria, India, and Croatia.
Table 4: Cotton Yarn Imports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 5,971 | 6,926 | 6,306 |
| Bulgaria | 4,588 | 5,057 | 2,834 |
| Croatia | 367 | 657 | 1,575 |
| Germany | 446 | 625 | 1,401 |
| Portugal | 78 | 110 | 230 |
| Extra EU-28 | 16,121 | 16,902 | 19,989 |
| Turkey | 13,852 | 14,541 | 17,044 |
| India | 1,047 | 997 | 1,640 |
| Egypt | 1,038 | 1,015 | 937 |
| Pakistan | 142 | 152 | 197 |
| World | 22,092 | 23,828 | 26,295 |
Source: GTA
Table 5: Cotton Yarn Exports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 40,795 | 45,576 | 43,463 |
| Germany | 12,075 | 11,354 | 12,429 |
| Italy | 7,817 | 10,150 | 9,604 |
| Bulgaria | 2,205 | 2,664 | 3,922 |
| Spain | 6,168 | 7,560 | 3,362 |
| Extra EU-28 | 1,957 | 2,292 | 2,292 |
| Switzerland | 1,185 | 1,176 | 1,355 |
| Macedonia | 96 | 358 | 326 |
| Tunisia | 303 | 239 | 285 |
| Serbia | 211 | 96 | 220 |
| World | 42,751 | 47,868 | 45,755 |
Source: GTA
Table 6: Cotton Fabric Imports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 4,529 | 4,997 | 4,607 |
| Italy | 2,567 | 2,485 | 2,471 |
| Spain | 432 | 634 | 675 |
| Bulgaria | 409 | 478 | 455 |
| Germany | 464 | 813 | 326 |
| Extra EU-28 | 11,285 | 11,239 | 16,447 |
| China | 1,970 | 2,747 | 6,715 |
| Pakistan | 5,429 | 5,553 | 5,764 |
| Turkey | 2,655 | 2,177 | 2,898 |
| India | 496 | 202 | 551 |
| World | 15,814 | 16,236 | 21,054 |
Source: GTA
Table 7: Cotton Fabric Exports (480 lb. bales)
| Aug-Jul 14/15 | Aug-Jul 15/16 | Aug-Jul 16/17 | |
| EU-28 | 4,115 | 3,380 | 6,981 |
| Italy | 32 | 303 | 3,913 |
| Bulgaria | 3,725 | 2,788 | 2,756 |
| Romania | 73 | 69 | 92 |
| Cyprus | 73 | 110 | 87 |
| Extra EU-28 | 2,471 | 1,162 | 1,663 |
| Albania | 363 | 565 | 914 |
| Macedonia | 335 | 262 | 312 |
| Turkey | 1,603 | 197 | 257 |
| Serbia | 5 | 55 | 73 |
| World | 6,586 | 4,542 | 8,644 |
Source: GTA
Abbreviations and Definitions Used in this Report
The PSD tables are prepared based on an August 1 to July 31 marketing year. HS codes considered for Lint Cotton trade data: 5201
HS codes considered for Yarn Cotton trade data: 5204, 5205, 5207
HS codes considered for Fabric Cotton trade data: 5208, 5209
EU European Union
Ha hectare; 1 ha = 2.471 acres
MT Metric ton = 1,000 kg
1 MT = 4.593 480 lb. bales
480 lb. bale equivalent to 218 kg bale
Πηγή: USDA-FAS