India lifts ban on cotton exports, China demand still strong
Home & Textiles Today Staff -- Home Textiles Today, May 1, 2012
New Delhi - India's trade minister yesterday lifted a month-old ban on the export of cotton yesterday, according to several news sources.
The government will review the export program every 14 days.
The ban was put in place to ensure adequate supply to domestic manufacturers but was opposed by cotton farmers.
Meanwhile, strong demand from China continues to exert upward pressure on cotton prices, according to the Wall Street Journal.
"Chinese mills in need of cotton and trying to avoid high domestic prices have two options, both of which depend on the actions of the Chinese government," the Journal reported. "The mills are limited to a total import quota of 985,466 tons, which is separate from what the government imports for reserves, but domestic cotton traders say they expect the government to issue additional quotas when the cotton planting is complete at the end of April. The other option is that the government releases some of its reserves, as it did last year when prices in the U.S. hit a record of $2.27 a pound."
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