Dark clouds that have gathered over cotton, the once-white-gold, are yet to disperse. Rising stock, falling price, China’s detrimental policies, agricultural crisis and boom in synthetics are sending shock waves across nations, more so in India.
Browsing: China
I remember a presentation I made in China last June, where I proudly claimed that Indian textile industry would be well off even with less purchase of cotton and yarn by China. We all were buzz with optimism and were ranting the Indian consumption story.
Global yarn production fell in Q1/2015 compared to the previous quarter. Thereby, yarn output in Asia and in Europe fell, while it increased in North America. On an annual basis, the global yarn production decreased the second quarter in a row. Declines were strongest in Asia and Europe, while North America saw a modest increase. Worldwide yarn stocks rose in Q1/2015 in comparison to Q4/2014.
Despite some reduction in the export of Italian textile machinery to the traditional markets of China, India and Turkey, Italian textile machinery industry is optimistic of the rest of the 2015 and 2016 and is also having a positive outlook on the long-term prospects.
The Cotton Association of India fears that India may be piling up huge inventory of cotton just like China, if the Cotton Corporation of India (CCI) does not take measures to offload its stock swiftly. Maintaining the cotton output at the last estimated level of 38.27 million bales (a bale is 170 kg), Dhiren N Sheth, President, CAI, says the Corporation had procured about 8.7 million bales from farmers as part of the Government’s minimum support price commitment.
In the 2015-16 season, world cotton imports may recover modestly, increasing 2 per cent to 7.7 mts with imports outside of China rising by 3 per cent to 6.1 mts. In 2011-12, Chinese imports more than doubled from the previous season to 5.3 mts and surpassed the total volume of imports by the rest of world, which reached only 4.4 mts.
A brand manager of a US textile commodity, I met recently, called the trends happening in the Indian textile market as Mega Trends. Before coming to India, he had visited China and so his remarks took on greater importance.