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BEIJING, July 26: China needs to import at least 600,000 tons of cotton this year to meet rising domestic demand, the official Xinhua news agency said on Saturday.
Shi Jianwei, director of the cotton and sesame department of the All-China Federation of Supply and Marketing Cooperatives, was quoted as saying the country’s cotton production would not exceed six million tonnes this year.
Statistics released by the State Statistics Bureau in late June showed that China’s cotton output in 2003 was expected to reach 5.65 million tons, it said.
Cotton consumption by textile mills alone is estimated at around 6.3 million tonnes. If combined with cotton consumption for other purposes, the figure will reach 6.6 million tons, it said.
China has imported 489,217 tons of cotton in the first six months of 2003, customs data show.
NEW YORK: NY cotton futures finished easier Friday on thin speculative sales following yesterday’s surge, with brokers saying the market may consolidate going into next week.
December cotton shed 0.26 cent to end at 60.31 cents a lb, trading 60-60.65 cents. The rest lost 0.15-0.35 cent.
It’s just profit-taking after yesterday’s run-up, said Jobe Moss of brokers and merchants MCM Inc. in Lubbock, Texas.
Mike Stevens of Swiss Financial Services in Mandeville, Louisiana, said an attempt to probe higher quickly ran into trade sales which convinced the locals to exit longs and return to fight another day.
He added that the downside was limited by a lack of interest in selling the market beneath 60 cents by the trade or speculators.
Stevens said some small speculators sought to push cotton past 60 cents, but that move faltered as well.
Analysts said the market should stay well supported above its recent lows of around 58-59 cents, basis December, due to steady demand and some tightness in fiber supplies going forward.
Certainly, hopes of a correction towards 57 (cents) seem to be fading for now, said Stevens.
Looking forward, dealers said market participants will await release of next month’s USDA supply/demand report and the end of the 2002/03 marketing year (August/July).
Dealers said the market will also monitor weather conditions and development of the US cotton crop, and the pace of development in other cotton growing regions like China.
Marketing analyst O.A. Cleveland said while the US crop has enjoyed two to three weeks of good weather, it still remains far behind normal progress.
Technicians see support in the December contract at 59.60 and 58.50 cents, with resistance at 60.40 and 60.90 cents. Final volume reached around 2,000 lots, against the prior tally of 6,733 lots. Total open interest in the cotton market fell 200 lots to 62,109 lots as of July 24.—Reuters
