Chinese textile mills experienced “many problems” with the foreign cotton they purchased in 2003-04, particularly the 4 million bales they bought from the United States, a spokesman for the China Cotton Association said.
Li Lin acknowledged that China's 2003-04-production shortfall of 1.73 million tons (7.9 million bales) and its rapidly growing textile demand forced it to import types of cotton that its mills were not accustomed to spinning. But she said Chinese mills had more difficulties with the cotton than they anticipated.
“In 2002-03, China had a sufficient supply of high grade cotton to meet demand. Thus in that year, China's cotton import demand was mainly for middling and strict low middling grades,” she told participants in a Cotton Quality Summit in Singapore.
“In 2003-04, however, China's domestic supply of high grade cotton was low and the price stayed high. In order to maintain normal production, textile enterprises were forced to look to the international market for cotton that was relatively less expensive but of acceptable quality.”
Li, director of public relations for the China Cotton Association, led a group of 20 Chinese textile mill executives to the Certified FiberMax Quality Summit, which was sponsored by Bayer CropScience and organized by Globecot, Inc.
U.S. cotton industry leaders have said China's government has used complaints like those voiced by Li as an excuse to impose new restrictions on cotton imports to avoid meeting its tariff rate quota obligations under the agreement it made before joining the World Trade Organization in 2001.
But one analyst said the Chinese genuinely believe they received less quality than they thought they were buying in some of the shipments received from the United States since last fall.
“There is probably no doubt that some of the stuff shipped to China wasn't up to snuff because people have this impression that the Chinese are used to handling and producing junk, although that is decidedly not the case,” he said.
“On the other hand, maybe 100 mills bought U.S. cotton in 2002-03. But this year 6,000 textile mills were authorized to import cotton. And where many of those are used to getting a Type 129, which is a good middling, or a Type 229, which is a step lower, they got middling 1-3/32 inch. They're not used to handling that grade of cotton.”
Li also referred to the China Cotton Association's feeling that strict middling/good middling grades “do not match the level of China's grades 1 and 2.
Specifically, China's concerns included the following:
- The U.S. grade is basically one step below China's equivalent grade.
- Micronaire exceeded contract specifications.
- Short fiber content was too high.
- Cotton quality was not uniform, “as the same shipment or even the same bale could have two or more grades of cotton present.”
- Nep count was too high.
- Contamination was too high.
- Contamination from the bale packaging was a big problem for spinners.
“If price wasn't a factor, China's textile enterprises would prefer to use domestic high grade cotton,” said Li.
Although many in the United States have a mental picture of the Chinese cotton industry as being farmers hauling cotton to the gin in an oxcart, much of the country's textile industry is anything but antiquated.
Chinese textile enterprises, which include some of the largest mills in the world, have accounted for one-third of the world's textile spinning equipment purchases in the last two years. Other presenters at the Summit in Singapore predicted China's mill consumption could reach 34 million bales in 2004-05 — about one-third of the world's total.
“In the last few years, China's cotton textile industry has made great strides in improving technology and equipment,” said Li. “In the 1990s, 50 percent of China's cotton textile industry reached international standards, including increased numbers of combing and cleaning lines, combing machines, automatic winding machines and shuttleless looms.
“With these advances, the combed yarn share rose to 23.8 percent of China's total output.”
The China Cotton Association is a relatively new organization that represents cotton farmers, cotton farmer cooperatives, enterprises engaged in cotton production and cotton textile enterprises.
“The purpose of the China Cotton Association is to provide service, coordination, and self-discipline and protect the interests of entities involved in the area of cotton according to the requirements of a socialist market economy and become a bridge and link between enterprises and cotton farmers and the government,” said Li.
Li, who formerly worked at the Cotton and Jute Bureau of the All China Federation of Supply and Marketing Cooperatives, spoke through an interpreter at the summit but appeared to understand English during interviews with agricultural editors.
Asked to give a percentage of U.S. cotton shipments that did not meet China's grade standards, she said those figures would be available following a June 29 meeting on quality issues in Beijing.
Although China may not repeat its purchases of 8.8 million bales of foreign cotton in 2004-05, analysts believe next year's buying could be substantial because of the continued growth of the Chinese textile industry.
The National Cotton Council has also been asking the Bush administration to have China live up to its tariff rate quota requirements for purchasing at least 3 million bales of U.S. annually.