Registration for exporting cotton yarn is at a high of at least two years, owing to the burgeoning demand from Bangladesh and China.

Data compiled by the Directorate General of Foreign Trade under the Ministry of Commerce and Industry showed in November 2012, registration for exporting cotton yarn stood at 100 million kg, 32 per cent higher than in the year-ago period and five per cent more than in the previous month.

“Of late, China has turned out to be a major buyer. While orders have also started flowing in from Pakistan, Turkey and Brazil, in addition to many new small markets, Indian traders have also become aggressive to execute past orders,” said Barat Malkan, partner at IB Yarn Agency, a Mumbai-based cotton yarn trader. With demand in the global market set to revive, the flow of export orders was likely to continue, he said.

After growing from 62.81 million kg in April to 82.42 million kg in June and 94.51 million kg in July, export registration fell 64.27 million kg in September. But owing to hopes of good growth in China and signs of a recovery in western economies, the demand for textile products is expected to rise, resulting in higher registration of cotton yarn exports, said a trader, on condition of anonymity. The textiles ministry has forecast cotton yarn production to rise this financial year, after a steep decline in 2011-12. Cotton yarn production stood at 3,079 million kg in 2009-10, 3,490 million kg in 2010-11 and an estimated 3,126 million kg in 2011-12.

The decline in production in 2011-12 was due to the sudden fall in the prices of cotton/cotton yarn, which led to high-cost inventories.

Meanwhile, the order flow has started reflecting on prices. In the last month, cotton yarn prices for the benchmark 30 count variety rose by Rs 10 per cent to Rs 190 a kg.