According to the US officials, the Chinese cotton imports will remain suppressed next season, as the government continues to draw down on cotton stocks, while production recovers. The US Department of Agriculture’s Beijing bureau noticed that Chinese government’s priority is still “to ease the burden of its large cotton stocks following years of state cotton purchases”. This attitude will keep a pressure on the imports. According to the reports of the bureau from the industry sources, the Gov. Cotton sales could reach 3.79 million ton in the year 2017, up from 2.66 million ton. But according to the bureau, the current uptake at the auctions of below 805 is not supporting the estimated high volume of the sales.
By the end of 2017-18, the Chinese government sales were seen drawing down stocks, from 12.67 million ton to 8.90 million ton. According to the bureau, the industry observers believe that China could succeed well in reducing the cotton reserve of the state to about 5 million ton by the end of 2018. This would be considered as a manageable level as compared to the 13.9 million ton, in 2014-15, when China’s cotton reserves peaked after three years of state support purchase programs.
These cotton sales will keep a cap on the imports with the forecast at 2017-18. These imports were forecast at 1.00 million tons, compared to a 13-year low of 9.59 million tons seen in 2015-16, and 9.80m tons expected in the current 2016-17 season. Chinese cotton consumption is seen robust because of the steady economic growth, reaching 8.00 million tons, in 2017-18.
The cotton production of china in 2017-18 is forecast to recover to 5.15 million tons,” up 100000 tons year-on-year, thanks to rising plantings, seen up 100000 hectares to 3.1 million hectares.
