Cotton exports: India outperforming US in China

21 June 2007

Mumbai: Cotton exports from the country to China are outperforming US cotton exports to that country, says the latest report of the US Department of Agriculture (USDA).

Cotton exports from India have jumped nearly 25 per cent in 2006-07, with an estimated 62 per cent going to China, USDA said, adding, that India''s cotton production has almost doubled in the past five years.

With large exportable surpluses and low prices India has turned into a major exporter of cotton. India''s exports have been rising sharply in the past few years, the report added.

In contrast, US cotton exports are expected to decline by 28 per cent to 13 million bales this year from 18 million bales last year with less demand overseas.

"Since becoming a significant exporter last year, with cheaper freight rates and lower cost of production, India has consistently under-priced US cotton to Far East ports like China. That price differential swelled to a high of $32 per bale in January 2007," the report said.

The current cotton price in the US puts them below India''s price to China CIF for the first time in more than a year, it said.