Bangladesh has joined two other countries to lead the global cotton trade recovery as the demand for the commodity has risen sharply because of buoyant apparel shipments, based on the USA Department of Agriculture (USDA).
"Record global trade is boosted, led by robust demand in China, Bangladesh, and Turkey," the USDA said in its June report.
Cotton exports are up for the three most significant exporters -- India, Brazil, and the United States. The US forecast has higher exports while stocks are projected at their lowest in four years.
The US season-average farm price has lowered by one cent to 67 cents per pound, the USDA said in its report on cotton for 2020-21.
For 2021-22, the June forecast shows higher trade and consumption with lower production and stocks.
Less consumption outlook for India is a lot more than offset by the higher-than-expected demand in China, Bangladesh, and Turkey, driving higher imports for these countries, said the USDA.
The recent import growth of cotton in Bangladesh resulted from the skyrocketing demand among local millers, spinners, traders and importers.
For example, the export of yarn in the local markets is regarded as to have become by 163 % year-on-year between April and June this season, data from the Bangladesh Textile Mills Association (BTMA) showed.
This is due to higher demand from garment exporters, and for resumption of the full utilization of capacities of mills by spinners and weavers, it said.
In the first 11 months of fiscal 2020-21, the united states earned $28.57 billion from garment exports, registering 11.1 % year-on-year growth, according to data from the Export Promotion Bureau.
Knitwear shipments fetched $15.36 billion, and woven garments brought home $13.19 billion, clocking 20.55 per cent and 1.80 % year-on-year growth, respectively.
The export data implies that the Bangladeshi garment sector is recovering fast with the rise popular in the western world.
A substantial development was the return of woven shipments to the positive territory last month after declining for a year.
The demand for woven items had fallen under western culture as formal events were suspended because of the lockdowns and fears over contracting Covid-19.
Knitwear items maintained 12 % growth during the last year because of a rise in demand for more extended stays of individuals at home.
"The recovery trend is good, and it will not be short-term this time around," said Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
However, it will require long to recoup the industry's losses this past year because of the fallouts of the Covid-19, he said.
"We have been acquiring a small number of work orders. There has been the reinstatement of previous orders. But many factories are running at losses," Hassan said.
This past year, international clothing retailers and brands either suspended or cancelled work orders worth $3.18 billion, of which 90 per cent have already been reinstated so far.
Hassan said the retailers and brands have been paying up, but there have been many who had gone bankrupt and were still delaying payment.
The quantity of merchandise trade was down 15.5 % year-on-year in the next quarter of 2020 when lockdowns in many countries were completely effect. But by the fourth quarter, trade had surpassed the level of the same period in 2019, said the World Trade Organisation on May 28.
On the global cotton trade, the USDA said China's 2020-21 imports were forecast at a seven-year high, driven by the best projected consumption in three years, robust state reserve imports, and attractive prices for imported cotton in accordance with domestic supplies.
Imports are expected to support China's record year-over-year rise in consumption.
China's 2020-21 consumption is likely to recover from the cheapest level in 16 years to surpass the prior year by 7 million bales, accounting for half of the gain in global use.
Currently, spinners' spot margins are roughly 30 per cent higher weighed against that of the previous year as a result of robust demand for cotton yarn and considerably lower yarn stocks, said the USDA.
Since Bangladesh is not a significant cotton-producing nation, 99 per cent of the requirement for the raw material is met through imports.
Traders, importers and millers may import 8.5 million bales of cotton this season, spending $3 billion this year, said the BTMA.
This past year, cotton imports fell to 7.5 million bales as production came to a halt in many mills following the government had imposed nationwide restrictions to tame the coronavirus pandemic. (One bale equals 480 pounds.)