Secretariat of the International Cotton Advisory … GuidLines s...-10% -5% 0% 5% 10% 15% 20% 1977 1981 1985 1989 1993 1997 2001 2005 2009 2013 Cotton Poly Staple Poly Filament GROWTH

Secretariat of the International Cotton Advisory Committee

PSAP MEETING 75th ICAC Plenary Meeting

Islamabad, Pakistan October 30, 2016

1.  Historical background 2. Apparel and Intermediate products Import Analysis 3. Strategies for the Cotton Sector to face inter-fiber competition

1.  Historical background 2. Apparel and Intermedia products Import Analysis 3. Strategies for the Cotton Sector to face inter-fiber competition

0 10 20 30 40 50 60 70 80 90

100 Cellulosic Non-Cellulosic Wool Cotton

Million tons

20

30

40

50

60

70

MARKET SHARE OF COTTON IN WORLD TEXTILE FIBERS CONSUMPTION

Percentage

Average 1960-1979

Average 1980-1999

Average 2000-2016

-10%

-5%

0%

5%

10%

15%

20% 19

77

1981

1985

1989

1993

1997

2001

2005

2009

2013

Cotton Poly Staple Poly Filament

GROWTH OF COTTON AND POLYESTER FIBER CONSUMPTION - WORLD

% change

0

20

40

60

80

100 19

75

1980

1985

1990

1995

2000

2005

2010

2015

Cotton Poly Staple Poly Filament

GROWTH OF COTTON AND POLYESTER FIBER CONSUMPTION – WORLD

Million tons

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0

1975

1985

1995

2005

2015

Polyester Nylon Acrylic Other Fibers Cellulosic

33%

57%

80%

Million tons

0

10

20

30

40

50 19

90

1995

2000

2005

2010

2015

Million tons

ROW India China

POLYESTER FILAMENT CAPACITY

13%

33%

56%

68%

74%

0

5

10

15

20

25

30

1990

1995

2000

2005

2010

2015

Million tons

ROW India China

POLYESTER STAPLE CAPACITY

13%

27%

53% 62%

67%

1.  Historical Overview 2. Apparel and Intermediate products Import Analysis 3. Strategies for the Cotton Sector to face inter-fiber competition

COTTON YARN TRADE Average 2011-2014

IMPORTS EXPORTS

China45%

Hong Kong

8%Bangladesh

5%

Korea4%

Turkey3%

ROW34%

India30%

Pakistan18%USA

12%

China9%

Hong Kong

5%

ROW25%

POLYESTER YARN TRADE Average 2011-2014

IMPORTS EXPORTS Filament

Staple

Turkey17% Brazil

8%

Vietnam7%

Korea6%

Egypt5%

ROW57%

China33%

India21%

Malaysia9%

Taipei9%

Indonesia6%

ROW23%

Brazil13%

Turkey12%

Korea10%

USA6%

India6%

ROW54%

China40%

Indonesia30%

India7%

Viet Nam5%

USA2% ROW

15%

COTTON FABRIC TRADE Average 2011-2014

IMPORTS EXPORTS

China8%

Hong Kong

8%Italy5%

USA4%

Turkey4%

ROW72%

China55%

Pakistan10%

Hong Kong8%

India6%

Turkey6%

ROW31%

Russia8% China

8%

Brazil8%

Turkey7%

Indonesia5%

ROW65%

POLYESTER FABRIC TRADE Average 2011-2014

IMPORTS EXPORTS Filament

Staple

China56%

Korea11%

Malaysia4%

Turkey3%

Japan3%

ROW23%

Russia7% China

7%Sri Lanka

5%Hong Kong

4%Germany

3%ROW73%

China57%

Hong Kong5%

Korea4%

Germany4%

Thailand3%

ROW27%

APPAREL TRADE

SHARES OF DEVELOPED, DEVELOPING AND CEEU COUNTRIES IN WORLD TEXTILE FIBRE CONSUMPTION

Developing

Countries 51.2%

Developed Countries

45.2%

C. and E. Europe

and former USSR 3.6%

2000

Developing

Countries 64.0%

Developed Countries

32.0%

C. and E. Europe

and former USSR 4.0%

2015

0%

25%

50%

75%

100% 20

04

2006

2008

2010

2012

2014

Percentage

China Vietnam Bangladesh Pakistan Turkey Indonesia India Mexico Rest of World

MMF

0%

25%

50%

75%

100%

2004

2006

2008

2010

2012

2014

Percentage


COTTON

0%

25%

50%

75%

100% 20

04

2006

2008

2010

2012

2014

Percentage


MMF

0%

25%

50%

75%

100%

2004

2006

2008

2010

2012

2014

Percentage


COTTON

0%

25%

50%

75%

100% 20

04

2006

2008

2010

2012

2014

Percentage


MMF

0%

25%

50%

75%

100%

2004

2006

2008

2010

2012

2014

Percentage


COTTON

0.0

0.5

1.0

2004

2009

2014

Cost/Unit

China Vietnam Bangladesh Pakistan Turkey Indonesia India Mexico Rest of World World

COTTON

0.0

0.5

1.0

2004

2009

2014

Cost/Unit


MMF

0.0

2.0

4.0

6.0

2004

2009

2014

Cost/Unit


COTTON

0.0

2.0

4.0

6.0

2004

2009

2014

Cost/Unit


MMF

0.0

2.0

4.0

6.0

2004

2009

2014

Cost/Unit


COTTON

0.0

2.0

4.0

6.0

8.0

2004

2009

2014

Cost/Unit


MMF

Ø Competitive Pricing and Price Volatility Ø Technology: improve in yields, lower cost of

production Ø R&D: improve cotton fiber performance against

synthetics fibers. Ø Sustainability: reduce environmental impact Ø Promotional Campaigns Ø Trade Policy

COMPETITIVE PRICING

*Weekly quotes

US cents/lb

0

50

100

150

200

250

5-A

ug-1

0

5-Ju

n-11

5-A

pr-1

2

5-Fe

b-13

5-D

ec-1

3

5-O

ct-1

4

5-A

ug-1

5

5-Ju

n-16

Cotlook A Index

China Polyester

China Cotton Index Indian Spot

-50%

-25%

0%

25%

50% 74

/75

79/8

0

84/8

5

89/9

0

94/9

5

99/0

0

04/0

5

09/

10

14/1

5

Season highest value

Season lowest value

Difference with respect to season average

PRICE VOLATILITY BY SEASON: Daily Cotlook A Index

TECHNOLOGY: Improve in Yields

0

500

1000

1500

2000

1980

/81

1985

/86

1990

/91

1995

/96

2000

/01

2005

/06

2010

/11

2015

/16

Kg / ha World India China USA Pakistan

TECHNOLOGY: Lower cost of production

0.82 1.11 1.04

1.22 1.5

1.16

0

1

2

00/01 03/04 06/07 09/10 12/13 15/16

US$/Kg Lint

India

China U.S

Brazil Pakistan

Net Cost of Lint Production - World

RESEARCH AND DEVELOPMENT: improve cotton fiber performance

SUSTAINABILITY -  The Indicator framework

recommended by SEEP, provides a common language to measure sustainability in cotton production all over the world

-  Change people’s perception about cotton production and show actual results and improvements by country

-  Reduce environmental impact: (water, land, etc.)

PROMOTIONAL CAMPAIGNS

TRADE POLICY

Thank you for your attention!

Documents

Secretariat of the International Cotton Advisory … GuidLines s...-10% -5% 0% 5% 10% 15% 20% 1977 1981 1985 1989 1993 1997 2001 2005 2009 2013 Cotton Poly Staple Poly Filament GROWTH