China Has Gradually Shifted The Direction Of Imported Cotton Based On The Analysis Of Cotton Export Data From The United States And Australia

Recently, American cotton exports began to show a seasonal upward trend. As of March 6, American Cotton had shipped 5.48 million export packages, more than half of the USDA export forecast. In order to meet the USDA export forecast, the weekly average shipment of American cotton needs to reach 264000 bales in the rest of this year. Considering that the supply of American cotton is increasing from now on and the shipment volume tends to increase from now to May, it should be easy to achieve this goal.

Up to now, the cumulative committed sales volume of American Cotton (shipped+not shipped) is 10.45 million bales. Since some contracts will be carried forward to the next year (2.5 million bales on average in the past five years), the current problem is not export sales, but shipment before the end of the year. At present, USDA's export forecast will be easily realized, and may even exceed expectations. The market may have realized that China's demand for American cotton may not be as important to American cotton exports this year as in previous years. Since this year, the export sales and shipments of American cotton have begun to exceed the average level required to complete the USDA export forecast (11 million bales). At present, there are only 280000 bales of American cotton waiting to be shipped in China, so the risk is actually small. The market speculated that China may have shifted its procurement focus to other places of origin, such as Brazil, in anticipation of the decline of Sino US trade.

In February 2025, Brazil exported 277000 tons of cotton, 34% less than that in January, the lowest level in nearly five months, but still the highest level in February. Historically, Brazil's cotton exports began to decline in February, bringing opportunities to US cotton exports. In February, Brazilian cotton was mainly exported to Pakistan, Bangladesh, Vietnam, Turkey and China (11%). As of February this year, China is the largest buyer of Brazilian cotton, accounting for 22% of Brazilian cotton exports. Other major export regions are Vietnam, Pakistan, Bangladesh and Turkey.

Recently, the U.S. Department of Agriculture raised its forecast for Brazilian cotton exports this year to 13 million bales. As of February, Brazil's exports had totaled 8.826 million bales, more than enough to complete the export forecast. In the later period, the monthly average exports only needed to reach 835000 bales (181800 tons). Last year, the average export volume of Brazil from March to July was 2141900 tons. Judging from the situation this year, Brazil has sufficient cotton supply.

In January, Australia's cotton exports fell to 163500 bales, a 50% month on month decline, the lowest level in the same period of nearly three years. This export year (from March 2024 to February 2025) accumulatively exported 4.95 million bales. Before the processing of new cotton in 2025, the export of Australian cotton will fall to a very low level. It is expected that the export in February will continue to decline significantly. In January, Australian cotton was mainly exported to Bangladesh, Vietnam and Indonesia, while its exports to China accounted for only 10%.