The ongoing US-China trade war could not leave any negative impact on cotton prices, contrary to apprehensions that the increasing tariff measures would make the fibre costlier in international markets.
For cotton, Bangladesh depends a lot on India, supply from where meets nearly 60 percent of Bangladesh’s annual demand of 7.1 million bales.
In the beginning of the war, some Indian cotton traders raised the prices a bit in the name of higher cotton demand by Chinese importers as the Trump government imposed 25 percent tariff on export of cotton to China from the US.
“But Bangladeshi firms did not go for panic buying like in 2010, when cotton prices reached a historic high,” said Monsoor Ahmed, secretary to Bangladesh Textile Mills Association, a platform for spinners, cotton importers, users and weavers.
“Rather they adopted a ‘go slow’ policy, which ultimately helped to keep cotton prices stable in Bangladesh.”

On August 4, cotton was traded at 89.5 to 87.5 cents a pound in international markets.
The fibre—a basic raw material for garment fabrics—was traded at the same price range a month earlier, when the economic tangle between the two global giants started.
“In 2010 and 2011, a section of international traders created an artificial crisis and raised cotton prices by nearly five times to around $2.5 a pound. For almost seven years, the fibre’s price remained stable at $0.5-$0.6 a pound.”
Experts attributed the rise to a gradual tightening of stock, an unexpected freeze in China’s cotton producing areas, a historic flood in Pakistan and a ban on exports from India.
“This time our importers and mill users were very cautious,” he said.
China purchases more than $1 billion worth of cotton from the US every year. With the higher tariff in place, the Chinese cotton importers started buying the fibre from India, but not in bulk. Moreover, China started importing cotton through Vietnam from the US, which played a vital role to keep its price stable worldwide.
Bangladeshi importers started reducing their overdependence on Indian cotton three to four months ago thanks to the availability of high quality African and American cotton at competitive prices, Ahmed said.
Now, only 40 percent of the cotton demand in Bangladesh is met with the Indian variety.
On the other hand, cotton imports from Africa has increased by 15 percentage points to 40 percent and from the US, the amount stands at 8 percent, which was around 4 percent even two years ago.
Some traders sell the fibre from different warehouses established in Singapore, Malaysia and Sri Lanka, which increased the availability of African cotton, he said.
“So, there is no crisis of cotton at competitive prices at all now.” “I don’t see anything abnormal happening to cotton prices due to the trade war,” Mehdi Ali, president of Bangladesh Cotton Association, the club of domestic cotton traders, told The Daily Star. “Bangladeshi mill users and importers should not be worried as the country now has enough cotton in stock backed by a better domestic production of the crop.”
According to the May report of the United States Department of Agriculture on cotton, the world’s ending stocks forecast of cotton was down slightly for 2018-19.
However, stocks outside of China will increase for the third year in a row and reach a record high of just over 50 million bales. Global cotton consumption is also expected to hit a record, over 125 million bales.

www.thedailystar.net

Cotton farmers of Gujarat are expecting a lower yield and crop failure due to insufficient rains in the state thus far.
Cotton farmers of Gujarat are expecting a lower yield and crop failure due to insufficient rains in the state thus far. The state has similar acreage of cotton this year as it was last year but at the crucial growing period many cotton growing areas, mainly in Saurashtra and North Gujarat are still dry and do not have enough irrigation facilities. According to farmers and cotton industry experts, it will be harmful for standing cotton crop if the state does not have good spell of monsoon instantly.
According to the state agriculture department’s latest data, as on August 6, 2018, cotton sowing has been done on 2.65 million hectares which was 2.64 million hectares in corresponding period last year. “Cotton crop needs immediate rain. It is a growing period and if rain does not come within a week, cotton may face big loss. This year, farmers had begun sowing late due to delay in monsoon. The flood situation has already damaged cotton in some parts of Saurashtra and South Gujarat. Yield of the crop will not be as expected in Gujarat this year in present scenario,” said Ramesh Bhorania, farmers and agriculture expert from Naranka village of Rajkot.
As on date, Gujarat has received 454 mm rains which is about 55% of the season’s normal average of 831 mm. Situation was much better last year. The state had received 662 mm rainfall that was 82% of normal till 8 August. “Gujarat is the leading cotton growing and producing state in India and any loss over there will affect the entire cotton trade of the country. Districts like Surendranagar, Kutch, Morbi and Banaskantha which are big areas of cotton have received very poor rainfall so far. All these factors will decrease the yield and may affect the price and supply too,” said Atul Ganatra, president of Cotton Association of India (CAI).
Ganatra said that average yield is about 550 kg per hectare in India. In its recent estimate, the cotton body has estimated cotton production of 36.5 million bales (a bale of 170 kg) for the entire season ending 30 September 2018. It has estimated 10.8 million bales cotton production in Gujarat. According to the CAI, as on 31 July, total arrival stood at 35.34 million bales across India. During this season so far, the country has exported about 6.7 million bales of cotton and by end of the season total exports from India would be about 7-7.2 million bales.

www.financialexpress.com

In a bid to expand khadi’s global reach, week-long exhibitions will be held in 10 countries as part of Independence day celebrations.
Products supplied by Khadi and Village Industries Commission (KVIC) have been shipped yesterday for display in cities in Bahrain, Iran, the UK, Singapore, Jordan, Australia, Canada, Portugal, Saudi Arabia and Italy.
A statement issued by KVIC said 20 types of fabric to be displayed in the exhibitions range from muslin to silk and from cotton to wool, along with selected high-quality readymade garments like Modi jacket, shirts, tops, designer kurtas, western wear and niche village industries products like shops, shampoos, sanitizers, herbal tea/coffee and leather wallets.
Last month, KVIC chairman Vinai Kumar Saxena had written to Indian embassies in 42 countries last month, seeking their support in promoting khadi in their respective consulates during Independence Day celebrations this year.
“In what comes as the increasing popularity of khadi across the globe, 26 embassies/high commissions responded positively and shown their interest in promoting the signature fabric of India,” he said. He said it is the first move in taking khadi from a local to global platform. “Based on khadi’s multiplying USP abroad, KVIC plans to organise similar exhibitions in 50 other countries on October 2, which incidentally coincides with 150th birth anniversary of Mahatma Gandhi,” Saxena added.

www.business-standard.com

NEW DELHI: Europe’s foreign trade association Amfori has said that India and the European Union should focus on resolving differences over three crucial issues if they want to break the deadlock on the longstalled free trade pact.

Amfori said talks should initially focus on India’s demand for a liberal visa regime for its nurses, a relaxed geographical indications regime and duty cuts on its textile exports . Christian Ewert, president of Brussels-based Amfori, told ET that EU’s insistence on India committing to sustainability norms is one of the sticking points as Delhi is against the inclusion of non-trade issues such as environment and labour in its trade pacts.
We are looking at alternatives to revive the talks and early harvest is one of those,” Ewert said but highlighted “great reluctance on both sides” for an early harvest. Talks on the trade pact, called Bilateral Trade and Investment Agreement (BTIA), have been held up since 2013 and a recent informal meeting of two sides on how to resume negotiations failed to yield results. “We need to identify services which are in short supply in Europe such as healthcare and IT,” he said. The EU now asks for trade and sustainability chapters in all its trade pacts and that is among the five areas of contention between the two sides.
Slashing of import duty on European cars and alcohol by India, recognition of the country as a ‘data-secure’ nation to enable free flow of data between the two and easier visa norms for Indian professionals are the other sticking points. India exported merchandise worth $53.5 billion to the EU in 2017-18 while it imported $47.8 billion worth of goods from the trade bloc. Besides Brexit, the other causes of slow movement on the BTIA is the EU’s involvement in free trade agreements with other countries, including some in Asia such as the Philippines. “Further, EU is challenged by the refugee situation,” Ewert said. The EU’s apprehension to sign a BTIA separate from the Bilateral Investment Treaty (BIT) with India has further added to the delay.
Not having a bilateral investment treaty is a hindrance to investments,” he said. The European Commission had raised concerns over negotiations for a fresh BIT .

economictimes.indiatimes.com

Textile industry in India has been facing numerous challenges since the implementation of goods and services tax (GST) in July 2017. Adding to the plight was the withdrawal of duty drawbacks, which, coupled with free trade agreements (FTAs) with some of the neighbouring nations, made Indian textile products expensive in the international markets.
The increased cost of production threatened the survival of micro, small and medium enterprises (MSMEs) as FTAs resulted in cheaper finished textile products flooding the domestic textile market. The industry players have been leaving no stone unturned to convince the decision makers about the ground reality.
The government has doubled import duty on 328 textile products to 20% thereby curbing rising imports from China and giving a boost to domestic manufacturing. However, a majority of imports into India is from countries like Bangladesh, Vietnam and Indonesia, thanks to FTAs. India will not be able to give any direct exports incentive to the sector, so there is definitely a need to support exporters to encourage domestic manufacturing.
While the government’s duty hike move is certainly positive for the sector, it is too early for textile industry players including MSMEs to rejoice and pop the champagne bottle.

www.dnaindia.com

About 97 per cent of the estimated 365 lakh bales (170 kg each) of cotton crop for the 2017-18 season has arrived in the market by July-end, the Cotton Association of India (CAI) has said in its latest estimate of India’s cotton situation. The CAI has kept its estimate for the current season beginning October 1, 2017 unchanged from previous two estimates.
The CAI has, however, revised the state-wise crop estimate for the North Zone compared to the estimate made during the last month, based on the arrival figures up to July 31, 2018 reported by the respective states.
In Punjab and Haryana, the crop estimates for the season have been reduced by 2 lakh bales and 50,000 bales respectively compared to the estimate made during the last month. However, the crop estimates for Upper Rajasthan and Lower Rajasthan have been increased by 1.00 lakh bales and 1.50 lakh bales respectively compared to the last month based on the arrival figures.
The CAI has projected total cotton supply up to July 31, 2018 at 400.45 lakh bales. This includes arrival of 353.45 lakh bales up to July 31, 2018; estimated imports of 11 lakh bales; and the opening stock of 36 lakh bales at the beginning of the season as on October 1, 2017.
Further, the CAI has estimated cotton consumption for 10 months i.e. from October 2017 to July 2018 at 270 lakh bales, while the shipment of cotton till July 31, 2018 has been estimated at 67 lakh bales.
Thus, the stock at the end of July 2018 is estimated at 63.45 lakh bales including 42.65 lakh bales with textile mills while the remaining 20.80 lakh bales are estimated to be held by CCI and others (MNCs, traders, ginners, etc).
The projected yearly Balance Sheet for the Season 2017-18 drawn by the CAI estimates total cotton supply till end of the season i.e. up to September 30, 2018 at 416 lakh bales of 170 kg each. This includes opening stock of 36 lakh bales at the beginning of the season. The CAI has estimated domestic consumption for the season at 324 lakh bales while the exports are estimated to be 70 lakh bales. The carry-over stock at the end of the 2017-18 season is estimated by at 22 lakh bales.

www.fibre2fashion.com

More than 40% of transactions by volume are done with MSMEs registered on the Government e-mrketplace GeM, the government said on the occasion of completion of two years of the platform on Thursday.
More than 40% of transactions by volume are done with MSMEs registered on the platform, said an official release.
GeM was launched on August 9, 2016, with the objective of creating an open, transparent and efficient procurement platform for government.
Over its short journey, GeM has achieved many significant milestones, including achieving gross over Rs. 10,000 Crores in Gross Merchandise Value (GMV) through more than 6.16 Lacs transactions on the platform.
It has made over 4.2 lakh products available on its platform through a network of over 1.3 lakh sellers and service providers.
Buyers from across 36 States & Union Territories (UTs) are buying on the platform. 24 States & UTs have signed a formal MoU with GeM to adopt GeM as the core procurement portal in their respective territories.
Average savings of 25% achieved across transactions on the platform, said the release.

www.smetimes.in

The Labour Ministry and relevant parties have started talks on the minimum wage for workers in the textile, garment and footwear industries for next year.
A ministry announcement yesterday said initial talks to set the parameters for the mew minimum wage were scheduled for this month and discussions between it, employers and unions will take place next month.
“All parties have to use social criteria such as family status, inflation rates, living expenses and economic criteria,” a ministry statement said. “The economic criteria includes productivity, the country’s competitiveness, labour market conditions, profit margins and the poverty level.”
The ministry requested all parties to focus on providing data based on research into the criteria as set out in Article 5 of the Minimum Wage Law to use as the basis for negotiations.
Ath Thun, president of the Coalition of Cambodian Apparel Workers Democratic Union, said yesterday that the respective unions have already conducted informal discussions on the issue.
He said the coalition is also conducting a survey on the cost of living and plans to hold discussions with international unions later this month.
“So far we have just talked to other unions about a suitable wage, but we still have nothing specific to put forward,” he said. “We have yet to obtain feedback from our survey.”
“After getting the feedback we will meet to propose a figure that has been jointly agreed upon as we do not want to have any disagreement among the unions,” he added.
According to the ministry, the minimum wage for garment, textile and footwear workers was officially set at $170 per month this year.

www.khmertimeskh.com

Union Minister of Commerce & Industry and Aviation Suresh Prabhu launched Niryat Mitra – mobile App in New Delhi on Wednesday. The app developed by the Federation of Indian Export Organisations (FIEO) is available both on Android and on IOS platforms.
It provides wide range of information required to undertake international trade right from the policy provisions for export and import, applicable GST rate, available export incentives, tariff, preferential tariff, market access requirements – SPS and TBT measures.
The most interesting part is that all the information is available at tariff line. The app works internally to map the ITC HS code of other countries with that of India and provides all the required data without the users bothering about the HS code of any country. Presently the app comes with the data of 87 countries.

timesofindia.indiatimes.com

Though the acreage under the fibre has gone up in Gujarat, delayed rains are set to hit productivity
Even as cotton acreage has increased in Gujarat, the State may witness a decline in yield following deficient and delayed rains. Cotton sowing in the State — the largest grower of the fibre crop — reached 26.5 lakh hectares as on August 6, which is about 10,000 ha more than last year. But a decline in yield will cap the crop size, leading to a further spike in prices.
According to experts, lower yield is also becoming a major concern in other growing regions, such as Maharashtra, where the pink bollworm has surfaced in cotton plants.
“There is definitely going to be an impact on yield due to delay in rains in parts of Gujarat. We are also seeing yields being impacted in States such as Maharashtra due to pink bollworm,” said Atul Ganatra, President of the Cotton Association of India (CAI). He said that India’s average yield is about 550 kg/ha. “This year, we see yields to be even lower than that, because there is no growth of plants and the crop is suffering because of the lack of rain,” he added.
Looming rain deficit
Cotton growers in Saurashtra and North Gujarat — two key cotton growing regions in the State — have raised an alarm with most of the districts facing deficient rains in the range of 62-88 per cent of the normal rainfall. The scenario last year around the same time was completely different with most of the North Gujarat districts witnessing heavy rains.
Gujarat had received 662 mm rainfall (or 82 per cent of normal) till August 8 last year, while till Wednesday rainfall stood at 454 mm (or 55 per cent) of the season’s normal 831 mm.
“Farmers have not given up hope, but even if it rains now, already about 40 per cent of the season is lost. Delayed rainfall will only brighten prospects for the rabi crop. It won’t help much for kharif,” said Ramesh Bhorania, a farm expert from Rajkot. “There will be a big loss in the cotton crop if it doesn’t rain within a week. There are fears of a lower yield even in other places,” he added.
Cotton balance sheet
For the 10 months (October 2017 to July 2018), CAI has estimated cotton consumption at 270 lakh bales, while exports are seen at 67 lakh bales. The stock at the end of July 2018 is estimated at 63.45 lakh bales. For the entire season ending September 30, 2018, CAI puts the supply at 416 lakh bales. The cotton body has estimated domestic consumption at 324 lakh bales, while the exports are estimated to be at 70 lakh bales. The carry-over stock at the end of the 2017-18 season is projected at 22 lakh bales.
“Prices may remain firm going forward. With the MSP fixed at ?5,450/quintal, it will come to around ?47,000-48,000 per candy (of 356 kg). So, if the private players need to purchase, they will have to pay this higher price,” said Ganatra.
Chinese demand
What will further fuel the price rise is Chinese purchases, which are expected to be at about 25-35 lakh bales in November, December and January.
“China’s buying is fuelled by the 25 per cent tax on cotton coming from the US. For India, there will also be demand for about 40 lakh bales from Bangladesh and Vietnam,” he added.

www.thehindubusinessline.com