China Cotton Monthly Review - November, 2014

As cotton harvest is closed nationwide in November, the picking and selling pace is found slower than last year due to weather and price impacts. Seed cotton purchase came to the final phase in some cotton regions. Prices of both seed cotton and lint spot moved downward, the cotton import kept at low level, price gap home and abroad narrowed down, carryover stock of commercial cotton increased largely, while at the same time, the increase of textile production slowed down and export of textile and apparel decreased further.
According to National Bureau of Statistics, the cotton acreage nationwide in 2014 is 4.22 million hectares, 2.9% down than last year, the crop output is 6.16 million tons, 2.2% down Y/Y, and the average yield is 1,461 kg/hectare, 0.7% up Y/Y. The statistics of China Cotton Association showed the national acreage is 4.23 million hectares, 9.35% down Y/Y, the national yield is 6.50 million tons, 7.11% down Y/Y.
In Xinjiang seed cotton buying came to the final state and its price collection completed in November. The inland subsidy policy was clarified, which speed up the seed cotton buying there, although still at quite slow pace. By 30th November, national cotton picking finished by 98.45%, 1.13% down Y/Y, 76.9% of projected yield was sold, 8.13% down Y/Y.
As for the seed cotton market, the average buying price of seed cotton is 5.9 Yuan/kilo, 0.19 Yuan less than last month, and 2.88 Yuan down than the corresponding time last year. The carryover stock of commercial cotton is composed mainly by Xinjiang supervised cotton, with a few import or inland cotton. By the end of November, the commercial carryover stock is 2.12 million tons, 1.20 million tons more than last month, and 1.85 million tons up Y/Y. CC Index 3128B has monthly average price of 14,685 Yuan/ton, 163 Yuan down over the month.
With weak textile demand, cotton import stayed at low level. According to Customs, the November cotton import is 92,100 tons, 12.4% up over the month, while 46.8% down Y/Y. At the same time cotton yarn import was steady with 164,300 tons in November, 4.9% down over the month. Textile manufacture reported increase in November, with yarn production of 3.58 million tons, 3.2% over the month. Export of textile and apparel was 24.35 billion USD, 8.3% down over the month. The import goods tariff plan was announced, according to which the cotton import will continue to be levied by sliding duty at previous rates.