The majority of the raw material yarn and fabric produced in the garment factories of Bangladesh is cotton. However, its local production capacity is negligible (2-3%) compared to the demand. So it is almost entirely dependent on imports. At present the demand of cotton every year in the country is more or less 85 lakh bales. Although cotton was brought from different countries of the world, Bangladesh was dependent on India for a long time.
Over time the dependence of Indian cotton is decreasing due to many factors, among which third country warehousing is playing a major role. Among them, some warehouses have been built in Malaysia’s Klang port using financing facilities from Jeddah-based Islamic Development Bank. Bangladeshi importers can bring cotton from there within seven days according to demand.
According to the country’s yarn and cloth producers, if quality is taken into consideration, the United States will be number one, Australia will be second and African cotton will be in third position. Indian will rank 6th or 7th position. However, a large amount of cotton is now being imported from Africa mainly due to third country port warehousing facility.
Mohammad Ali Khokon, President of Bangladesh Textile Mills Association (BTMA) said that there are many complications in storing cotton in the country. The interest rate on inventory goes up a lot. For this reason shippers store cotton in third country’s port according to the demand of Bangladesh. It can be brought in just seven days. Mainly because of this advantage, the import of cotton from the African region is gradually increasing.
Based on National Board of Revenue (NBR) data, the United States Department of Agriculture (USDA) says that in the 2022-23 marketing year (August-July), Bangladesh’s largest cotton imports came from West Africa, which accounted for 39 percent of total demand, with 9 percent sourced from Cameroon and 3 percent imported from Chad. As such, 51 percent of the total cotton import has been from countries in the African region.
Besides, 16 percent was imported from Brazil of South America, 12 percent of cotton comes from neighboring country India and 10 percent of the cotton came from the United States. However, trust on USA-made cotton’s among Bangladesh’s textile millers also increasing for its quality and contamination free– US cotton imports reached almost $470 million in 2022.
Large movement of cotton used to come to Bangladesh mainly from India, as the neighboring countries and availability of cheap cotton. But the yarn and cloth producers of the country claim that the quality of cotton coming from India has never been satisfactory. Moreover, Indian institutions often do not keep their promises. Problems also remain in yarn-fabrics produced due to substandard cotton.
Meanwhile, African cotton does not differ much from India in terms of price also the cotton is better than India. Although the country is far away from India, Bangladeshi importers are preferring Africa instead of India due to third country warehouse facilities. Due to which the import of cotton from Africa is increasing and from India has decreased to a large extent.
