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African nations have surpassed India to become the largest source of cotton for Bangladesh as local spinners and millers look to cut down their dependence on a single source for their vital raw material.
Last year, Bangladesh, the largest importer of cotton in the world, met 37.06 percent of its requirement for the white fibre from East and West African countries.
India accounted for 26.12 percent of the total cotton imports, down from more than 60 percent two years ago, according to data from the Bangladesh Textile Mills Association (BTMA).
Last year, 11.35 percent of the cotton came from the CIS (Commonwealth of Independent States) countries, 11.14 percent from the US, 4.65 percent from Australia and 9.65 percent from the rest of the world.
The low quality of the Indian cotton is the main reason behind the falling imports from the neighbouring country, said Monsoor Ahmed, secretary of the BTMA.
A section of Indian cotton traders also cannot maintain timely shipment and deliver the right quantity of cotton as per agreement, said Mehdi Ali, president of the Bangladesh Cotton Association.
For example, it is written in the letter of credit that there may be 3 to 4 percent less cotton than the amount agreed upon when the imported fibre is weighed in Bangladesh. But in many cases it is 10 to 15 percent less.
“This is a big loss for us. We can’t afford these kind of losses. This is another reason for moving away from India,” Ali added.
The concentration of moisture in the Indian cotton is higher than in other countries’, which makes it difficult to store in the warehouses for a long time.
Last year, Bangladesh imported 8.28 million bales of cotton (one bale equals to 282 kilogrammes). In dollar terms, the imports are worth $3 billion.
The country produced 1.65 lakh bales of cotton last fiscal year, which is less than 3 percent of the annual demand for 10 million bales.
In order to bump up local production, state-run Cotton Development Board is looking for new farming lands in hilly and swamp areas in various districts along with the existing farming areas in Jashore, Rangpur, Dinajpur, Rajshahi, Gazipur and Mymensingh.
The board hopes to produce 2.5 lakh bales of cotton by 2021, which will meet nearly 5-7 percent of the local consumption.
Bangladesh’s cotton imports will continue to be commensurate with the expansion in spinning, according to the latest report of the United States Department of Agriculture.
Global consumption is forecast to grow to a record of about 126 million bales.
Growth is slightly above the long-term average and is expected to remain the same in all of the top 10 spinning countries except Indonesia, with continued strong growth forecast for Vietnam and Bangladesh, the report added.
source (TDS)
