Cotton Consumption Growth Faces Greater Challenges

In 2015/16, cotton consumption in the world is expected to be reduced by 1 million 590 thousand tons over 2009/10. One of the reasons for the decrease in China's consumption is that domestic cotton prices have been substantially higher than the international cotton prices in the long run, and the other reason is that the price difference between China's cotton and chemical fiber is too high.

Although cotton prices in China have approached international cotton prices several times before the rise in cotton prices in previous years, cotton prices in China have been two times the price of chemical fibers before 2010/11.

Therefore, it is difficult for China to restore cotton.

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As China is the largest textile producer in the world, this is also a key factor to curb global cotton consumption growth.

In addition, the global economic downturn has also made cotton.

Growth faces greater challenges.

The latest forecasts of the International Monetary Fund show that global GDP growth has been down in 2015 and 2016.

As cotton demand is closely related to economic growth, slowing economic growth will also become a major obstacle to cotton inventory digestion.

According to the above analysis, the recent international cotton prices are difficult to break through the recent trading range.

According to the analysis of the US Cotton Corp,

Reducing the quota of cotton import quotas is the most significant feature of the global cotton market since the adjustment of China's cotton policy.

Since 2011/12, China's cotton imports have decreased by 3 million 600 thousand tons, or 74%.

At the same time, cotton imports increased in other regions. The most notable was Vietnam, with an increase of 650 thousand tons of imports, but it could not offset the decrease in China's imports.

In 2015/16, global cotton imports are projected to decrease by 2 million 678 thousand tons over the average of 2011/12 and 2012/13.

The reduction of global cotton import demand is an important factor leading to the fall of international cotton prices.

Another factor that has led to a fall in cotton prices is that cotton consumption has always been at a low level.

The US Department of agriculture predicts that China's cotton consumption will be 7 million 290 thousand tons in 2015/16, a decrease of 3 million 590 thousand tons over the 10 million 880 thousand tons in 2009/10.

In terms of import volume, imports from other parts of China have increased in recent years, especially those that have increased significantly in China's yarn exports.

Generally speaking, cotton consumption has increased by about 2 million 180 thousand tons outside China since 2009/10, but this is only 60% of China's cotton consumption.