Overview of the Market for Cotton Lint And Cotton Seed in China

In 2018, the Chinese market for cotton lint increased by % to $, rising for the second consecutive year after four years of decline. Over the period under review, consumption, however, saw a relatively flat trend pattern. The most prominent rate of growth was recorded in 2012 when the market value increased by % against the previous year. As a result, consumption reached the peak level of $. From 2013 to 2018, the growth of the market failed to regain the momentum.

In value terms, cotton lint and cotton seed production expanded rapidly to $ in 2018 estimated in export prices. Overall, production, however, showed a relatively flat trend pattern. The most prominent rate of growth was recorded in 2008 with an increase of % year-to-year. As a result, production attained the peak level of $. From 2009 to 2018, and cotton seed production growth remained at a lower figure.

The average yield of cotton lint in China was estimated at kg per ha in 2018, approximately mirroring the previous year. Overall, the yield saw a relatively flat trend pattern. Despite the increased use of modern agricultural techniques and methods, future yield figures may still be impacted by adverse weather conditions.

The cotton lint and cotton seed harvested area in China was estimated at ha in 2018, approximately mirroring the year before. In general, the harvested area saw a relatively flat trend pattern.

In 2018, consumption of cotton lint increased by % to tonnes, rising for the second year in a row after four years of decline. Over the period under review, consumption, however, recorded a perceptible reduction. The pace of growth appeared the most rapid in 2012 with an increase of % y-o-y. As a result, consumption attained the peak volume of tonnes. From 2013 to 2018, the growth of the and cotton seed consumption remained at a somewhat lower figure.

The value of the market for cotton lint in China rose sharply to $ in 2018, picking up by % against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers' margins, which will be included in the final consumer price). Overall, consumption, however, recorded a relatively flat trend pattern. The growth pace was the most rapid in 2012 when the market value increased by % year-to-year. As a result, consumption attained the peak level of $. From 2013 to 2018, the growth of the market remained at a somewhat lower figure.

Depressed by shrinking demand for cotton lint and cotton seed in China, the market is expected to continue its downward consumption trend over the next decade. The performance of the market is forecast to contract with an anticipated CAGR of -% for the period from 2018 to , which is projected to depress the market volume to tonnes by the end of .

In 2018, the share of imports in total consumption accounted for % in value terms and % in physical terms. The share of imports decreased moderately (- percentage point) over the period under review.

China remains a net importer of cotton lint and cotton seed; in physical and value terms, imports consistently exceeded exports from 2007 to 2018. In 2018, there was a significant trade deficit of tonnes, which was equal to $. This tangible trade deficit reflects the fact that the market remains dependent on imports, which is likely to continue in the medium term.