Chinese cotton prices are adopting opposite trend from global market. Cotton prices are hovering at a high level in most countries, but the prices are falling in China. An analysis said that China Cotton Index (CCI) declined around 31.10 per cent since February 2022 when prices peaked. Prices crashed 24.13 per cent after the US ban in June this year.
According to Fibre2Fashion’s market insight tool TexPro, China Cotton Index (variety 2227B) was traded at CNY 17,157 per ton in August 2021. The prices registered an upward trend till February except in December 2021. Cotton peaked at CNY 21,051.56 per ton in February this year. Chinese cotton adopted similar trend as global movement till February. But the trend reversed in the coming months as an effective date of US ban on cotton and cotton products originating from Xinjiang region of China was nearing. Cotton slipped around 7 per cent in the next four months till June when the ban came into effect.
As per TexPro, Chinese cotton crashed to CNY 15,698.85 per ton in July from CNY 19,117.67 per ton in June 2022. It means that the prices registered a steep decline of 17.88 per cent in July. The price further dropped by 7.61 per cent to 14,503.41 per ton in August. Current prices are converted in Indian currency to ₹174 per kg (₹61,956 per candy of 356 kg).
According to media reports from China, local government and industry are taking the US ban as a hostile step in international trade activities. Chinese government and business community are trying to consume locally banned cotton and export to other countries, but market sentiments are dampened due to oversupply.