Cotton Yarn Exports from Pakistan in 2013

Total world trade of cotton-rich textile yarns (comprising >/=85% cotton) stood at around US$14.6 billion in 2013. With around US$2.2 billion worth of exports, Pakistan managed to get a share of approx. 15% in the global trade of cotton-rich yarns. That makes Pakistan the second largest world exporter of cotton yarns in the world. India stood at the top of the list with 33% share in the global cotton yarn trade. The third largest exporter was China with a share of 13%, followed by USA, Viet Nam, Turkey, Uzbekistan, Indonesia and Korea (Table 1). According to USDA statistics, China has been the largest producer of cotton fiber in 2013-14 with 32 million 480 lb. bales, followed by India (29.5 million bales), USA (12.9 million bales) and Pakistan (9.5 million bales). Hence, Pakistan was the fourth largest cotton producer and the second largest cotton yarn exporter in 2013.

In terms of growth in exports as compared to the previous year, India again stood at the top of the list with 51.28% increase, followed by Thailand (50.92%), Viet Nam (47.1%), Indonesia (36.42%) and Uzbekistan (23.42%). Pakistan’s cotton yarns exports grew just 4.89% as compared to the last year, which is far less than the overall growth of 9.83% in the world cotton yarn trade. Annual growth percentage in the export value from 2009 to 2013 has been 33%, 14%, 36%, 30, 32% for India, Pakistan, Viet Nam, Korea and Turkmenistan respectively. Countries with higher growth rates may pose a challenge to Pakistan’s share in the world market in the coming years.

China was the largest importer of cotton yarns in 2013 with 43% share of imports followed by Hong Kong and Bangladesh. Chinese cotton yarn market has been steadily growing over the last few years, and in 2013 it recorded a growth of 40% as compared to the previous year. Other markets have been fluctuating at modest figures. EU28 is not a huge market for cotton yarns, and accounts for a little less than 12% of the total global demand of cotton yarns. Asia Pacific Trade Agreement (APTA) Countries comprising China, Bangladesh, Korea, Sri Lanka and India account for more than 50% cotton yarn market of the world.

Table 1 Top Cotton Yarn Exporting Countries (Source: ITC)

In 2013, around 70% Pakistani cotton yarn was exported to China, followed by 8% to Hong Kong, 5% to Bangladesh, and 2% each to Korea, Portugal, Turkey and Japan

The unit value of Pakistani yarn stood at US$3065/ton, which is lower as compared to that of some other competitors such as India (US$3506/ton), China (US$4903/ton) and Egypt (US$7653/ton). If we look at the figures for various yarn categories given in Table 2, it can be noticed that Pakistan’s major contribution of cotton yarn exports is in ‘520512 category, which comprises carded single yarns of coarse to medium counts (dtex). Furthermore, Pakistan’s export share in the combed yarn categories is also poor. By focusing more on the finer yarn counts and combed yarn categories, the unit value of Pakistani yarns may be increased in future. Since the prevalent Pakistani cotton varieties are suitable mostly for producing coarse and medium yarn counts, government policies to facilitate the import of finer long staple cotton and to incentivize the export of finer and/or combed yarn counts may help in increasing the unit value of Pakistani yarn exports.

Table 2 Pakistan’s Yarn Exports (containing >/=85% cotton) in Different Categories (Source: ITC)