my country’s imports of Australian cotton may resume in 2022/23

According to customs statistics, my country’s cotton import volume in September 2022 was 89,000 tons, a month-on-month decrease of 17.6% and a year-on-year increase of 19.4%.…

According to customs statistics, my country’s cotton import volume in September 2022 was 89,000 tons, a month-on-month decrease of 17.6% and a year-on-year increase of 19.4%. Among them, the United States (accounting for 77%), Brazil (accounting for 13%), and Benin (accounting for 2%) occupy the top three places. It is worth noting that Australian cotton imports were zero in August, but in September, Australian cotton imports accounted for 2% of my country’s total imports that month, which is comparable to Benin, with strong month-on-month growth.

Judging from the quotations of some traders, some warehouses such as Qingdao and Hubei currently have a certain amount of Australian cotton for sale in 2020 (customs cleared, quoted in RMB), and the net weight fixed price of SM 1-5/32 (strong 29GPT G5) is concentrated at 18,500 -19,000 yuan/ton; the quantity of Australian cotton bonded in Qingdao Port in 2022 is relatively small, SM 1-5/32 (strong 29GPT) accounts for more than 90%, and the fixed price is about 110 cents/pound, which is the same as US cotton 21-2 /21-3 37 (strong 28/29GPT) quotes are basically the same or even slightly lower by 0.50-1.50 cents/lb.

A medium-sized cotton trading company in Jiangsu stated that the quantity of Australian cotton in the November/December shipping schedule has increased significantly compared with the previous period (new cotton in 2022). Some international cotton merchants, import companies, and cotton textile mills are enthusiastic about inquiry/purchase of Australian cotton. It is expected that my country’s imports of Australian cotton will show a recovery momentum in 2022/23.

First, the quotations of Australian cotton are no longer “overwhelmingly high”. Compared with competitors such as American cotton and Brazilian cotton, the cost-effectiveness of Australian cotton continues to improve. For example, the current basis price of Australian cotton M 1-5/32 shipped in China’s main port in November/December is about 100-102.50 cents/pound, while the quotation of US cotton 31-3 36/37 in the same shipping period reaches 101.50-103 cents/pound. pound, the price advantage of Australian cotton is highlighted.

Second, in 2022/23, affected by factors such as poor weather in the main cotton-producing areas of the United States and production cuts in Brazil, Australian cotton will have the opportunity to counterattack with high-quality cotton. Several months of drought in the southwestern and western cotton regions of the United States and continuous heavy rainfall in the southeastern cotton regions have led to increasing concerns in the industry about the quality indicators and production of U.S. cotton this year; while Australian cotton not only has a record production but also has high quality and consistency It is good and will accelerate its share of the global high-grade cotton market.

Third, China-Australia relations continue to recover, boosting Chinese cotton textile companies and traders to sign contracts to purchase Australian cotton. Previously, the defense ministers of China and Australia held talks, and the diplomacy between the two countries took a positive step. On November 8, Chinese State Councilor and Foreign Minister Wang Yi had a telephone conversation with Australian Foreign Minister Huang Yingxian at request. Huang Yingxian said that in recent times, Australia and China have maintained effective communication and contact. Through unremitting efforts, positive changes have taken place in the relations between the two countries.

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Author: clsrich