Importers differ on the prediction
Cotton imports to Bangladesh may fall in the current marketing year (MY) of June-May despite an increase in consumption of the major raw material of the garment industry, predicted the US Department of Agriculture (USDA).
In a recent report, they said the spinners may be inclined to use more cotton from their stock instead of import as the cotton price is shooting up.
The USDA report was published on 13 December this year.
In the report, USDA said cotton imports in Bangladesh may fall to 8.2 million bales in the MY22 from 8.75 million in the MY21.
“Due to the high international price of cotton, local spinning mills will consume more out of stocks,” said the report.
Referring to the rise in domestic cotton consumption that rose by 23 percent in MY21, the USDA report also projected that in MY22, cotton consumption may increase to 8.81 million bales.
But local cotton importers disagreed with the prediction of the USDA although they approved the estimated rise in consumption of cotton.
They said spinning mills have to keep a security stock of cotton to avert any future uncertainty.
After facing the blow of the covid pandemic, readymade garment export has increased 28% in the first 10 months of the current calendar year reaching $28.5 billion. Orders in Bangladesh increased as production was hindered in China and Vietnam.
Industry insiders expect the rising trend may continue for the next couple of months increasing cotton consumption.
Talking to the TBS, cotton importer Rising Group managing director Mahmad Hasan Khan said no one will take the risk of reducing stock in such a volatile cotton market which is prevailing now. That’s why it is unlikely that cotton imports will fall, he added.
Bangladesh Textile Mills Association (BTMA) chief executive officer Monsoor Ahmed told the TBS that a number of spinning mills are in the process of expansion with the rise in garment export. This will drive more imports instead of reduced volume, he added.
He however questioned how the USDA was sure of the actual stock of cotton with the factories.
