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Insight | Time:Dec 20 2017 3:09PM
Indian cotton export shipments rose sharply in November
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Main point of views: Indian cotton exports increased largely to 135,000 tons in Nov, up 642% month on month and 26.5% year on year. Meanwhile, cotton imports came off to 6,900 tons, down 74.81% month on month and 38.9% year on year. Although domestic prices rose, Pakistan and Bangladesh buyers still held strong buying interest, so estimated export shipments would keep rising in Dec.

Indian cotton export shipments
1. Export shipment volume in Nov, 2017
Indian cotton exports shipments were 135,000 tons in Nov, up 642% month on month and 26.5% year on year. With the large amount of arrivals in Nov, shipment volumes saw a huge growth. It's estimated that the volume would keep rising sharply next month.

2. Export destinations
Exports to Bangladesh which was the main destination, were 58,600 tons, taking 43.29%, and to China increased 22.01% to 30,000 tons from 57,000 tons last year. Also, there were 19.78% and 10.03% to Vietnam and Indonesia respectively. Pakistan resumed the issuance of Import Permits for Indian cotton on November 30, and contracts had been signed before. Shipments in November were 4.9 million tons, and it's estimated to increase sharply in December.

Cotton arrivals at Indian ports
1. Port arrivals in Nov, 2017.
Import arrivals were 6,900 tons, down 74.81% month on month and 38.9% year on year. Due to the high output of Indian cotton this year, import volume stayed largely below next year constantly since new cotton comes into the market.

2. Import origins
Main origins of import cottons in India in Nov, 2017 were Australia and the US, but US cotton imports and ratio dropped a lot, while Egyptian mid-long staple cotton arrivals rose continuously. Imports were 1,029 tons, which were 997 tons in Oct.

Price trend of Indian spot cotton
Indian cotton prices rose with the increase of Cotlook index from late Nov, which was unusual to see. Indian spot S-6 is offered at Rs.39,800/Candy, about 79.19cents/lb, up 6 cents than previous low.

On the one hand, the increase was because of the concerns on quality as arrivals stayed flat recently. According to CCI, ended by Dec 7, cotton arrivals were 1.26 million tons, up 25% than the same period last year, and taking 22% of expectation. On the other hand, demand from Bangladesh and Pakistan were high. Shipments in Nov increased largely, and would go up constantly in Dec. Also, the increase of ICE cotton futures was another factor. Downstream demand were supportive to prices, as local and foreign cotton yarn markets were active, led to a shortage in local market.

The late trend of Indian cotton prices remains an important factor in the international market, as the result of investigation on the effects of pests on new cotton has not announced yet. Considering the current strong demand in foreign and local market, Indian cotton prices are likely to keep firm in the short term.
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