India'S Cotton Export Policy Affects Global Cotton Production

India New Delhi decided on Wednesday

India is the second largest cotton producing country in the world. After China only came to China, India's domestic textile and garment production enterprises required adequate domestic supply of cheap cotton. Due to the pressure exerted by them, the India government banned cotton exports in March 5th.

But within a week, the anger of India's cotton producers forced the Ministry of Commerce to lift the ban on cotton exports.

India's agriculture minister, Sharad Pawar, said cotton exports were banned from selling cotton to overseas countries for better prices, mainly for sale in China.

When the India government lifted the ban, it decided to consider the cotton contract not yet shipped.

On Wednesday, the government agreed to export 1 million 900 thousand bales of cotton, each weighing 170 kilograms, within the existing contract.

India's cotton output will reach a new high this year, but India's cotton exports will also be high.

On Wednesday, the State Cotton Advisory Committee raised the estimated output of cotton for the year September 30th, and now the output estimate has been raised to a record high of 34 million 700 thousand packets, higher than the 34 million 500 thousand package output expected previously.

The Committee estimates that India will export 11 million 500 thousand bags.

The United States is the world's third largest cotton producer and largest exporter of cotton, and global cotton prices are crucial to the United States.

China is the largest cotton producing country, but most of China's output is used to feed its huge textile and garment industry.

China has been building cotton stocks. In fact, China's cotton reserves are worried by India textile manufacturers. They are worried that Beijing will gain an unfair advantage in terms of future prices.

According to the report of the International Cotton Advisory Committee, in the current cotton year, China's National Reserve has acquired about 3000000 tons of domestic cotton and at least 1 million tons of foreign cotton.

China imported at least 4 million 200 thousand tons of cotton this year, an increase of 61% over the 1010-2011 years.

The report said that China's procurement boosted global cotton prices, but once China decided to release reserves in the future, it would curb cotton prices.

The size of China's national reserves will create significant uncertainties in the global cotton market in the coming months, perhaps for years.

Beijing's inventory has put pressure on the India government, so India banned cotton exports last month, but India cotton farmers complain that they are overstock and production is rising.

Producers say local textile factories are carrying bank debts, and they want domestic cotton prices to fall, so they buy only a small amount of cotton.

Dhiren Sheth, chairman of the India Cotton Association, said: "after the government announced on Wednesday that it would allow more cotton exports, we were all hopeful."

India's Ministry of agriculture predicts that India's farmers will reduce their cotton planting area next year due to the government's policy of backdating.

The Department of agriculture predicts the cotton year by the end of September 30, 2013,