BEIJING: China’s cotton imports fell 62.3 percent in July from a year ago to 105,700 tonnes, trade website Cncotton.com said, citing customs data.
Imports by China, the world’s top cotton consumer, are already down by 33 percent this year to less than 1 million tonnes after the government issued fewer quotas in a bid to boost demand for domestic fibre.
The gap between international and domestic prices has also narrowed, reducing price incentives for buyers with a quota, with mills turning to ample supplies of domestic cotton. “We don’t expect the numbers to change very much for the next two years, until China stocks are drawn down,” said a trader in Beijing. China holds an estimated 11 million tonnes of cotton in state reserves, around half of the world’s stocks, after it bought up more than 80 percent of the domestic crop between 2011 and 2013 to support growers.
It is currently auctioning some of the fibre to mills at daily sales but has only managed to sell 3.7 percent of the volume offered to date. Imports for the 2015/16 crop year beginning in October are expected to fall to 1.3 million tonnes, down from 1.8 million tonnes in the current year, said the trader. Beijing’s surprise devaluation of the yuan last week, which pushed the currency to its lowest against the dollar in almost three years, is not seen as having a major impact on imports, he added.
