China's cotton imports in October surged 163 percent from the same period last year to 252,300 tonnes, an industry website reported on Friday, citing customs data. Cotton imports in the first 10 months of this year totalled 2.20 million tonnes, down 2.4 percent on the year, according to the report published on www.cncotton.com, a website operated by the China National Cotton Reserves Corp.
Market participants said China's rising imports in recent months are attracted by lower global prices of the high-quality cotton, most of which goes into state reserves, causing shortages in local market. "With the government buying, cotton prices have been stable and the market thinks it is seeing a bottom," said Lu Yun, an analyst with commodities consultancy firm Shanghai JCI, who added it could be a good time to buy. China started a cotton stockpile in early September with an attractive price to protect farmers' interests.
Industry participants said Chinese government has imported hundreds of thousands of cotton in early October to refill its dwindling stocks. But they said the government may not buy the crop aggressively in the near term due to the stockpile program. However, imports may still rise a bit in coming months because of attractive global prices.
"The imports may reach 300,000 tonnes (each month) in November and December," said Guo Rongmin, the China business manager with Cotlook Ltd, which publishes Cotton Outlook. News that China bought a large amount of cotton to replenish official stocks sparked a jump on the US cotton futures market.
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