Even though China farms more cotton than any other country, the Chinese textiles industry demanded 42% more cotton than domestic producers could provide in 2005.
A shortfall in cotton has been the trend for at least 5 years. By 2014, China’s demand for cotton will hit 12 million tonnes or about half of global cotton production.
To satisfy rising market demand, the Chinese National Development and Reform Commission (NRDC) expects China will have to import vast amounts of the downy-soft commodity for at least 7 more years.
Top Ten Cotton Producers
Below are the leading cotton producers for the 2004-5 season. Among the top 10 cotton-producing nations, the top 3 producers accounted for over 70% of their total production.
- China … 25.5 million bales (32.7% of cotton production from top 10)
- United States … 17.6 million (22.6%)
- India … 12.5 million (16%)
- Pakistan … 8.5 million (10.7%)
- Brazil … 4.4 million (5.7%)
- Turkey … 4.2 million (5.4%)
- Greece … 1.7 million (2.2%)
- Australia … 1.3 million (1.7%)
- Syria … 1.3 million (1.7%)
- Mali … 1.1 million (1.4%).
The following list shows which cotton-producing nations are best positioned to benefit from the accelerating demand for cotton.
Top Cotton Exporters
Below are the leading cotton exporters for 2004-5. America generates well over half of the exports from the top 10 nations.
- United States … 2.9 million tonnes (54.9% of cotton exports from top 10)
- Australia … 445.9 thousand tonnes (8.5%)
- Uzbekistan … 440 thousand (8.3%)
- Brazil … 331 thousand (6.3%)
- Greece … 286 thousand (5.4%)
- Mali … 206.8 thousand (3.9%)
- Egypt … 183.7 thousand (3.5%)
- Burkina Faso … 178.7 thousand (3.4%)
- Zimbabwe … 173.4 thousand (3.3%)
- Tajikistan … 133.1 thousand (2.5%).
Furthermore, the U.S. provides over half of the cotton exports to China. Chinese farmers complain that the American government unfairly subsidizes domestic cotton production by as much as US$3 billion annually. These subsidies lead to lower cotton prices on the world market and therefore less money into the pockets of Chinese cotton growers. In turn, Chinese farmers lack incentive to plant more cotton crops which could help alleviate shortages.
Top Cotton Importers
Below are the leading cotton importers in 2004-5. Among the top 10 importing countries, the top 3 took in almost 60% of their total cotton imports.
- China … 1,901.1 thousand tonnes (38.2% of cotton imports from top 10)
- Turkey … 585.1 thousand (11.8%)
- Indonesia … 448.7 thousand (9%)
- Mexico … 398.1 thousand (8%)
- Thailand … 358.4 thousand (7.2%)
- Pakistan … 330.4 thousand (6.6%)
- Russia … 308.1 thousand (6.2%)
- South Korea … 268.8 thousand (5.4%)
- Italy … 208.7 thousand (4.2%)
- India … 171.2 thousand (3.4%).
Notable by its absence from the above list, the U.S. has outsourced the bulk of its textile industry to developing countries with cheaper labour costs. Instead, the U.S. provides raw cotton to textile producing countries like China and then buys the finished cotton-fabric products.
The People’s Daily Online estimates that Chinese cotton growers lost as much as US$2.2 billion in revenues because of China’s cotton imports from 2001 to August 2005.
While China has shown great strides in becoming an international superpower in world trade, cotton is one arena where the United States continues to dominate the exporting and importing game.
Sources for this Article
This article presents independent calculations and insights based on data in the People’s Daily Online article ‘Chinese cotton growers lose…’ (Xinhua, March 29, 2006).
Daniel Workman - A senior business and finance writer who also does French translations, notably international trade and insurance materials.
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