Cot­ton quandary

As China, the world's big­gest cot­ton buyer, re­stricts im­ports, the US ag­gres­sively com­petes with In­dia for global mar­ket. Can In­dia stay in the race and res­cue its strug­gling cot­ton in­dus­try?

Down to Earth - - TEXTILE - MUKTA PATIL |

Tmar­ket in In­dia is in a HE COT­TON flux.The coun­try is set to be­come the world’s largest pro­ducer of cot­ton in 2014-15. In­dia’s cot­ton pro­duc­tion was es­ti­mated to touch 6.8 mil­lion tonnes be­tween Septem­ber and De­cem­ber 2014, says a press re­lease of the Cot­ton Ad­vi­sory Board (cab) un­der the tex­tiles min­istry. But there is un­cer­tainty about the bumper stock.With global stock­piles of cot­ton ris­ing and prices fall­ing in both the do­mes­tic and in­ter­na­tional mar­kets, ex­ports are likely to plum­met. The fears are con­firmed by China—the big­gest im­porter of cot­ton from In­dia and the US.

China has been cut­ting back on cot­ton im­ports since Septem­ber last year. In 201314, the coun­try al­lowed im­ports of 1.5-1.7 mil­lion tonnes. This year, it will re­duce this to about 0.9 mil­lion tonnes.Such a mea­sure is aimed at of­fload­ing its stock­pile to an op­ti­mum level and boost­ing do­mes­tic de­mand in the long run. The Chi­nese gov­ern­ment will also pro­vide di­rect sub­si­dies to cot­ton pro­duc­ers, an­nouned an of­fi­cial of the Na­tional Devel­op­ment and Re­form Com­mis­sion in China in Septem­ber 2014.

Strug­gling to find a mar­ket

China’s dras­tic mea­sure is likely to im­pact the cot­ton mar­kets both in the US and In­dia,but the lat­ter will strug­gle a lot more to com­pen­sate for the loss.This is ev­i­dent from the lat­est re­port of the United States Depart­ment of Agri­cul­ture (usda).

Ac­cord­ing to the re­port,dur­ing 2013-14, 26 per cent of the US’cot­ton ex­port went to China, while for In­dia it was al­most 55 per cent of its cot­ton ex­ports.This also in­di­cates that the US has a wider reach in the in­ter­na­tional mar­ket for cot­ton. Its share of global cot­ton ex­ports dur­ing 2014-15 is es­ti­mated to be around 2.2 mil­lion tonnes as op­posed to In­dia’s 1.1 mil­lion tonnes. This is de­spite the fact that In­dia pro­duced al­most dou­ble the amount of cot­ton than the US dur­ing 2013-14,claims usda.

This has raised con­cerns in In­dia about find­ing new mar­kets for its cot­ton pro­duce. Sid­hartha Ra­jagopal, ex­ec­u­tive direc­tor of

Although In­dia is set to be the largest cot­ton pro­ducer, its share of global ex­ports is lower than that of the US

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