China Cotton Monthly Review - January, 2014

In 2013, China cotton production reduced, at the same time textile indexes continued to increase, especially the fixed investment and export of textiles and apparel, while increase rate of industrial added value, yarn production and domestic sales slowed down. According to
Statistical Communiqué of the People's Republic of China on the 2013 National Economic and Social Development, cotton planting acreage in 2013 was 65.25 million mu (4.35 million hectare), 7.2% less over last year; the cotton output was 6.31 million ton, 7.7% less over the year; yarn production was 32 million ton, 7.2% up over the year.
Around Spring Festival, seed cotton buying was active in Yellow River region. According to CCA survey, by the end of January, seed cotton sales of the season processed by 95%, similar with the corresponding time last year, the seed cotton trade in Xinjiang and Yangtze regions closed in general, and that in Yellow River finished by 76%.
By the end of January, nearly 80% of cotton companies stopped buying seed cotton, and the monthly average buying price for seed cotton in standard quality by big bale ginners was 8.51 Yuan per kilo, 0.2% down over the month. Till the end of January, reserve cotton purchase in 2013/14 season totaled 5.62 million ton, nearly 80% of the seasonal harvest; state reserve sold cotton of 400,000 ton. Cotton policy changed in No.1 document of central government, which announced cotton target price subsidy trial in Xinjiang in 2014, with more details yet to come.
CC Index 3128B has monthly average price of 19,447 Yuan per ton, 0.4% down over the month. Carryover commercial cotton stock was 310,000 ton nationwide by the end of January. According to Customs, Import cotton in January totaled 290,000 ton, 52% less over the month, and 36% less Y/Y; export value of textiles and apparel was 28.6 billion USD, 10% up over the month, and 16% up Y/Y.
According to the second cotton planting intention survey conducted by CCA during the early February, the average intention reduced by 8.93% nationwide. The study on cotton target price and related policy in 2014 is under way and estimated to be released before the spring sowing.