China Has Issued New Cotton Import Quotas To Soothe Textile Mills.

P, the world's largest cotton consuming country and importing country, is considering issuing new import quotas, while selling part of < a href= "//www.sjfzxm.com/news/index_c.asp" > cotton < /a > inventory. Cotton Traders and analysts say the aim is to stop the potential crisis of the world's largest textile industry.

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"P > this high-profile program is still under consideration. The plan will allow spinning mills to purchase more foreign raw cotton," said a well-informed source. "It is not yet disclosed.

However, if approved, quotas will require textile mills to buy 3 tons of national cotton reserves for every 1 tons of cotton imported.

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< p > December 28th, the national planning and Reform Commission (NDRC), the highest planning body, said in a statement that it would be uncertain to sell some of the cotton from the record country a href= "//www.sjfzxm.com/news/index_q.asp" > cotton reserves < /a >.

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< p > Beijing has set up strategic reserves since 2011 to support farmers. It is very important for farmers to support the growing urban population.

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"P >" but, while helping growers, the policy has hurt China's textile mills, the state absorbs the supply of cotton in the domestic market, forcing the textile mills to rely on imported cotton.

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< p > auction of national cotton reserves plus new imports to solve the two problems faced by the government: after two years of massive acquisitions, the government can unload some old stocks and provide some cotton urgently needed for the domestic spinning mills. The domestic supply of cotton is tight and the domestic prices are high, making the textile mills miserable.

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By P, by March, Beijing will reserve about 8 million 600 thousand tons of cotton, enough to support the raw material demand of the Chinese textile mill for a year.

This is equivalent to 1/3 of the global 2012/13 output.

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Last year, China issued about 3700000 tons of import quotas and a floating tariff of 5-40%. P

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< p > 2012, China's reserves increased substantially, accounting for about 75% of China's 6 million 900 thousand tons of cotton, and most of the prices were 18500-19000 yuan / ton.

In 2011, it had already acquired a large number of acquisitions.

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< p > this price is equivalent to 1.35 cents / pound, which is more than 20% higher than that imported by the textile mill.

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< p > only a few textile mills have allocated quotas to imports, which means that most textile mills have to buy high priced domestic cotton, resulting in their lack of competitiveness.

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< p > China's cotton imports increased by 79% in the first 11 months of 2012, up to 4 million 600 thousand tons.

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< p > rumor has it that China will put some stock into stock. Many American cotton traders are worried about how long the government stock can last.

It is not clear whether the government will replenish its stock after the auction.

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< p > reserve policy has always been the key to supporting the market, because the consumption of textile mills is not strong.

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< p > because the United States is the largest country to export cotton to China, so long as the increase of imports can raise the US < a href= "//www.sjfzxm.com/news/index_s.asp" > cotton price < /a >.

The bulls are self comforting. They expect that the number of auctions may be very small compared with the overall inventory.

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< p > they think that in the long run, China may continue to import, although the number is reduced, so it is not a problem to auction stock.

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