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Last updated at: (Beijing Time) Thursday, July 03, 2003

Cotton Imports Surge in China

China's cotton imports have jumped this year due to strong domestic demand, and cotton imports through Shanghai in the first five months shot up 5900 percent over the same period last year.


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China's cotton imports have jumped this year due to strong domestic demand, and cotton imports through Shanghai in the first five months shot up 5900 percent over the same period last year.

Official figures indicate that from January to May, cotton imports in Shanghai stood at 104,000 tons, and in May alone, imports reached 45,000 tons, up 13900 percent over the same month last year.

The figure represents the highest import volume within one month in history.

China has always been a big cotton producer and consumer, and its cotton imports have remained at a low level in recent years, because production could normally meet demand.

Analysts attributed the recent jump in cotton imports mainly tothe country's entry into the World Trade Organization (WTO) and persistently high prices in the domestic cotton market.

China ranks top in the world in textile production capacity, but before China joined the WTO, its exports to some developed countries were restricted because of trade barriers.

Entry into the WTO expanded the market for China's textile products. It is predicted that by 2005 the country's exports of textile products and garments would reach more than 200 million USdollars on an annual basis, which would spur the growth of cotton demand by between 50,000 and 100,000 tons a year.

Reductions in import tariffs on cotton are also expected to stimulate the growth of cotton imports.

Since October last year, prices in the domestic cotton market have been on the rise, due to the drop in cotton output and irregularities in the market.

Meanwhile, some cotton traders have stored large amounts of cotton, expecting to make greater profits.

To improve the situation, the government is increasing sales ofits stockpiled cotton, and forcing traders to sell their cotton within a limited period of time.

Analysts have predicted that the high cotton prices will encourage farmers to plant more cotton, which could drive down cotton prices to a certain degree.


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