Customs statistics show that in August 2022, my country imported about 110,000 tons of cotton, a year-on-year increase of about 24.9%, showing a “tail-up” trend. However, in 2021/22 (2021.9-2022.8), my country imported about 1.74 million tons of cotton, which is higher than the previous year. The annual decrease is about 1 million tons, a year-on-year decrease of about 36.5%, which is not a small amount.
Specifically, the import volume of Brazilian cotton, Indian cotton, and US cotton in 2021/22 has declined significantly year-on-year. Since March 2022, the monthly import volume of Brazilian cotton has shown a “cliff-like” decline, accounting for the proportion of China’s cotton import volume in that month. Falling below 10% and 5%; the performance of Indian cotton imports is even worse. Indian cotton was almost removed from the “shopping cart” by Chinese buyers from May to August 2022, accounting for only about 1% of China’s total imports that month.
As for the reasons for the sharp decline in China’s total cotton imports in 2021/22, industry analysis mainly includes the following points:
First, since the first half of 2022, due to the negative impacts of repeated domestic epidemics, a large number of textile and clothing orders “flying southeast”, and the comprehensive escalation of the U.S. government’s ban on Xinjiang cotton imports, domestic enterprises have received significantly fewer new export orders (including traceability orders). ).
Second, affected by the surge in ICE since the first half of 2022, the import cost of foreign cotton under the 1% tariff (or sliding quasi-tariff) has been seriously inverted with the price of Xinjiang cotton in the mainland, and the range has even reached 2,500-3,500 yuan/ton. The competitiveness of imported cotton , the attraction to cotton-using enterprises has declined rapidly.
Third, the RMB exchange rate has depreciated significantly since the second quarter of 2022, and the cost of imported cotton yarn and other products continues to rise. According to statistics, the RMB depreciated by 8% from January to August due to factors such as the Federal Reserve’s continued interest rate hikes and the weakness of the euro.
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