Chinese cotton demand hit at least a 10-year low in August, thanks to a weaker economy and ample domestic stocks.
China imported 70,000 tonnes of cotton in August, trade website Cncotton.com said. This marks the weakest monthly imports since at least 2005.
China, once the world's biggest cotton importer, is in seeing rapidly falling imports.
In September the International Cotton Organisation pegged 2015-16 Chinese cotton imports at 1.6m tonnes, down 12% from the previous season and the fifth consecutive year of decline.
The US Department of Agriculture forecasts China's 2015-16 imports at 5.75m bales (1.25m tonnes), down 31% from the year before, and the lowest since 2002.
And this month Barclays said that China was set to be a net exporter of cotton by 2020.
Reeling lower
Low demand from China comes as economic weakness, which potentially threatens demand from China's clothing industry, exacerbates an existing policy of import reduction.
"At the outset of this year China was going to curtail imports," said Georgia Based cotton broker Keith Brown, "and then she starts to reel lower in her economy".
"The markets have become quite accustomed to a strong and vibrant china we're making the rules up as we go along," he warned.
And demand has also been hit by price competition from synthetic fibres, which have become much cheaper thanks to lower petrochemical prices.
Drawing down stock
China has been restricting cotton import quotas in a bid to increase domestic demand, as the government attempts to draw down its huge domestic stocks, which are estimated at 11m tonnes.
The inventories accumulated as part of a government stockpiling programme, which supported prices and helped grow the cotton industry.
Chinese government cotton auctions had an extremely muted reaction over recent months, with only 3% the offered cotton being sold.
The government was unwilling to price cotton to move, out of a fear of the effect on domestic prices, which could threaten producers.
But China has previously confirmed its commitment to meet minimum imports imposed by the Word Trade Organisation.
Chinese customs officials may need to issue more import quotas later in the year, in order to meet import demand, while mills with unused import quota's will need to return them to the government for re-issuing later in the year.
