VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 06/2023 ISSUE

MONTHLYREPORT
June 2023
Cotton and Yarn Statistic
--- For internal circulation only ---
Vietnam Cotton and Spinning Association
Collected&Edited:InformationandCommunicationDept.

2 https://vcosa.vn
Newsletter June 2023
REMARKABLE INFORMATION
International news
National news
🔹 Global cotton production forecast to hit 4-year high in FY24: USDA
🔹 Cotton price analysis as volatility retreats to 2021 lows
🔹 China’s PFY exports to India hit record high in May
🔹 Textile yarn market is projected to reach $18.5 billion by 2028
🔹 India imposes azo dye tests on Chinese textiles, to strain importers
🔹 Asia’s garment manufacturing should focus on strategic shift: McKinsey
🔹 Import of cotton decreased by 21.5% in volume in the first 4 months of 2023
🔹 The import of fiber is projected to continue its upward trend in the foreseeable future
🔹 Imports of yarn dropped sharply
🔹 Fiber and yarn exports are expected to bounce back soon
🔹 WB: Vietnam’s inflation shows signs of slowing down
🔹 Vietnam has climbed 69 spots in the global export value ranking, from 90th out of 126 to 21st, and is
close to breaking into the top 20
🔹 Vietnam remains out of currency manipulation watch list of US

3
https://vietnamyarnprice.com
INTERNATIONAL NEWS
T
he increase is predominantly
driven by the major cotton-
producing countries, with
the US and Pakistan leading
the charge. Both countries are
projected to see a significant rise in
production, each adding 2 million
bales to the global yield. India is
also expected to contribute to the
surge, albeit on a lesser scale, with
an additional half a million bales.
However, these gains will be
partially offset by a reduction in
output from China, the world’s
leading cotton producer. The
Chinese crop is anticipated to
shrink by 3.7 million bales in the
2023-24 season due to cooler than
normal temperatures early in the
growing season in China’s Xinjiang
region, which could limit yield
potential. This decrease means
China’s contribution to global
cotton production is expected to
shrink from 26 per cent in 2022-23
to 23 per cent in 2023-24, as per
USDA’s Cotton and Wool Outlook:
June 2023 report.
Meanwhile, India is set to buck
this trend with a projected 2-per
cent increase in cotton production
from the 2022-23 crop. This
rise comes despite an expected
reduction in harvested area, with
alternative crops predicted to
reduce cotton acreage to 12.4
million hectares. A rebound in
yield is set to offset this, with the
national yield forecast at 448 kg
per hectare, the highest in three
years. India’s share in global cotton
production is set to remain steady
at approximately 22 per cent.
Outside of the US, other
countries including Brazil,
Pakistan, and Australia are also
projected to see an increase in
cotton production. Brazil’s output
is expected to hit 13.25 million
bales, slightly above the 2022-23
figure and second only to 2019-
20’s record of nearly 13.8 million
bales.
Pakistan’s cotton production
is set to rebound from the nearly
four-decade low of 3.9 million
bales recorded in 2022-23 due
to flood damage. The forecast
production of 5.9 million bales for
2023-24 will account for 5 per cent
of global production.
Lastly, Australia’s 2023-24
cotton production is projected at
5.8 million bales, 300,000 bales
above 2022-23 and close to 2021-
22’s record of 5.85 million bales,
supported by above-average
reservoir levels.
Source: Fibre2Fashion
Global cotton production forecast to hit 4-year high
in FY24: USDA
World cotton production is projected to reach a four-year high of 116.7 million bales in 2023-24
(FY24), according to the US Department of Agriculture (USDA). The expected growth in production
represents a slight increase of 400,000 bales from the previous year.

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I
n a recent McKinsey report,
a group of experts from the
consulting firm’s Retail Practice
point out, Asian readymade
garment manufacturers need to be
strategic in the context of changing
scenarios in their importing
markets that were primarily driven
by the 2020-2021 lockdown, the
Ukrainian conflict and the ever-
rising environmental concerns
that the garment industry has been
facing for decades.
Post pandemic, most fashion
brands have changed their buying
strategy to make it more seamless
and foolproof, especially the ever-
important supply chain. Western
buyers now seem more interested
in their resources in Asia
undergoing digital transformation
and be analytics driven thus enable
themselves to provide smooth
interaction. So much so that in
the near future Western importers
might make digital transformation
a mandatory feature if the supplier
wants their business. The other
strategy gaining grounds is “near-
shoring” or having manufacturing
hubs closer to the consumer
market which lowers logistical
costs and saves on carbon miles.
The idea is suppliers invest in
creating hubs closer to their long-
term partners’ markets.
Asian manufacturers face
serious issues
China, India, Bangladesh,
Indonesia, Malaysia, Vietnam and
Sri Lanka are at the helm of global
exports of readymade garments.
However, with the US and EU
reducing orders steadfastly it has
created a crisis-like situation so
much so that in an all-time first for
the region, Vietnam and already
financially-crippled Sri Lanka shut
down factories or operated at a
bare minimum starting January
2023 until round April. Even
Bangladesh and India have run
units at 60 or 70 per cent capacities
and the challenged situation is
seeing profits spiral downwards.
The key challenges these
nationsfacearethatfashionbrands
are paying less to balance their
retail sales in an economic crisis-
hit west, which in turn is adding to
the cost pressure as Asian nations
too are paying more on operational
costs and raw material. The other
main challenge is the speed and
flexibility of suppliers, which
raises the point of near-shoring
for the benefit of a long-term
partnership, and flexibility so
supply chains can be rearranged
effortlessly if and when situations
Asia’s garment manufacturing should focus on
strategic shift: McKinsey
An important recommen-
dation for the future will be
partnerships that large Asian
manufacturers invest in. As
the fashion sector becomes
increasingly polarized, it has
been observed that the top
20 brands are resilient and
steady since 2019 until now.
It may be worthwhile deciding
who suppliers envision as
long-term partners and
initiate their choices based on
honest appraisals of their own
capacities and capabilities.

5
arise. Digital transformation, an
element that is poorly represented
in Asian manufacturing hubs
has to be deployed immediately
and sustainability has to be
taken seriously to gain credibility
in conscious consumers. That
is a lot to take on and in this
situation McKinsey has some
insightful recommendations to the
beleaguered sector in Asia.
Five-deck strategy to meet
challenges
An important recommendation
for the future will be partnerships
that large Asian manufacturers
invest in. As the fashion sector
becomes increasingly polarized,
it has been observed that the top
20 brands are resilient and steady
since 2019 until now. It may be
worthwhile deciding who suppliers
envision as long-term partners
and initiate their choices based
on honest appraisals of their own
capacities and capabilities.
Future-proofing manufacturing
units by leveraging digital and
analytics to drive productivity
and provide strategic benefits to
partners that are categorized as
long-term ones – the value on offer
will play a key role in sustaining
such partnerships.
Recalibration of commercial
negotiations that are based on
customers, their product portfolios
and the economic situation of
their markets will help fortify
the relationship as credibility
and practicality of the business
engagement will enable its
continuity.
Structural overhauling is
the fourth part of the strategy
that requires alignment of the
commercial aspect of the business
with demand and specification-
based initiatives in external
spends. Done well, this can end
up with about ten per cent cost
benefit for manufacturers.
Lastly, diversification of
geographic customer portfolio
and investing in targeted markets
thereby onboarding near-shoring is
a key strategy. The manufacturers
that have already adopted the
“local for local” are winning on
logistical costs already.
Source: Fashionating World
I
ndia has removed China from
a list of countries exempt from
azo dye tests for imported
textiles. These tests are crucial
as azo dyes, organically produced
synthetic dyes, are recognised as
potentially harmful to health.
This new non-tariff barrier,
enforced by India’s Directorate
General of Foreign Trade (DGFT)
under the ministry of commerce
and industry, might cause
shipment delays and additional
costs for Indian importers.
As per a notification issued
by DGFT on Wednesday (Jun
14), the updated exemption list
now includes European Union
(EU) countries, Serbia, Poland,
Denmark, Australia, Canada,
Japan, South Korea, and the United
Kingdom. The textiles imported
from these countries aren’t subject
to testing for the presence of azo
dyes. China was previously part of
this list.
Despite the potential setbacks
for Indian importers, industry
insiders see the move as a positive
health initiative. It is important to
note that India imports significant
quantities of yarn, fibre, fabric, and
garments from China.
In 2022, India imported fabric
worth $1,083.090 million, fibre
valued at $254.159 million, yarn
costing $1,359.584 million, and
apparel worth $350.238 million
from China, as per data obtained
from Fibre2Fashion’s market
insight tool TexPro.
Source: Fibre2Fashion
India imposes azo dye tests
on Chinese textiles
to strain importers

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T
he textile yarn market is
projected to reach USD 18.5
billion by 2028, growing at a
CAGR of 5.1% from 2023 to 2028,
according to a research report by
MarketsandMarkets.
One of the key drivers for the
increasing demand for textile
yarn is the expanding middle
class in emerging economies.
As more individuals enter the
middle-income bracket, there is a
higher demand for affordable and
fashionable clothing, leading to
increased consumption of textile
yarns.
Advancements in technology
have also played a significant role
in the growth of the market. These
advancements have enabled the
development of specialized yarns
with enhanced properties, such as
moisture-wicking, antimicrobial,
and eco-friendly characteristics.
These innovations have driven
the demand for technical textiles
in sectors like apparel, medical,
sports,automotive,andaerospace.
The plant segment is expected
to exhibit the highest CAGR during
the forecast period. This growth
is attributed to the increasing
demand for sustainable and eco-
friendly products. Plant-based
yarns, including cotton, hemp,
linen, and bamboo, are derived
from natural sources and are
considered more environmentally
friendly compared to synthetic
alternatives.
Consumers’ growing
environmental consciousness
has led to a shift towards
plant-based yarns due to their
biodegradability, renewability,
and lower carbon footprint.
In the artificial yarn category,
the polyester segment is expected
to dominate the market with the
largest share in 2023. Polyester
yarn offers exceptional durability,
strength, and resistance to
abrasion, wrinkles, and stretching,
making it suitable for a wide range
of textile products.
Additionally, polyester yarn
is cost-effective compared
to natural fibers, making it
an economical choice for
manufacturers and consumers,
especially in mass production
and budget-conscious markets.
Turkey is expected to hold
the largest market share in 2023.
The country’s textile industry
is renowned for its expertise in
manufacturing and a diverse range
of textile products. With a skilled
workforce, advanced production
technologies, and modern
infrastructure, Turkey produces
high-quality textile yarns that
meet international standards. The
country’s competitive advantage
lies in its cost-effectiveness,
offering lower labor and production
costs compared to many European
counterparts. This cost advantage
attractscustomersandcontributes
to the growth of Turkey’s textile
yarn market.
Source: openPR
Textile yarn market
is projected to reach
$18.5 billion
by 2028

7
C
otton price has moved
sideways since November
2022 as investors assess
the supply and demand dynamics.
It was trading at $88 on Monday,
where it has been in the past few
months. This price is a few points
above the year-to-date low of $76.
Cotton is an important
commodity that is used to
manufacture of clothes and
garments. Its demand has been
growing in the past few decades,
helped by the soaring world
population. Data shows that the
world has over 8 billion people, up
from over 6.1 billion in 2000.
Cotton prices surged hard
during the Covid-19 pandemic,
helped by the commodity
supercycle. It jumped from a
low of $48.08 in 2020 to a high
of $149.98 on May 2nd of 2022.
Since then, cotton has plunged by
more than 43% from its highest
point in 2022.
The biggest cotton producers
in the world are China, India, the
United States, Brazil, Pakistan, and
Australia among others. On the
other hand, China is the biggest
cotton producer in the world.
Other top cotton consumers are
India, Pakistan, Bangladesh, and
Vietnam among others.
The most recent WASDE
report showed that the US will
show higher production, helped by
favorable weather conditions in the
Southwest. Exports are expected
to grow by 500k bales to over
14 million bales. Globally, world
production will grow by 1 million
bales because of higher supplies in
US and lower production in China.
Cotton price analysis
as volatility retreats to 2021 lows
According to OECD,
global cotton production
is expected to continue
growing in the coming
years. India’s production is
expected to grow by 1.3%
p.a in the next decade.
In Brazil, where cotton is
planted as a second crop
in rotation with corn and
soybeans, is also expected
to see strong growth.

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P
FY exports hit market
expectation again in May.
According to the latest data
from China customs, PFY exports
approached 362kt in May, 2023,
hitting yearly new high and up
by 7.8% m-o-m and 21.5% y-o-y
respectively.
PFY exports amounted to
1721kt in Jan-May, 2023, up by
31% over the same period of
last year. The exports of PFY
are optimistically estimated to
reach more than 4 million tons
throughout 2023, to increase by
above 20% on the year.
After many years of
development, PFY export pattern
has been dramatically changed.
Leadingcompanieskeptexpanding
abroad with the advantage of price
and quality, snatching the market
share of small-and-medium-sized
plants and traders. Taking May as
an example, some traders saw a
20-30% of year-on-year reduction
in terms of PFY exports, while
leading enterprises’ PFY exports
advanced by more than 30% on the
year.
The increment in
May was almost all
contributed by the POY.
Exports of POY rose by
26kt over Apr and exports
to India increased by as
high as 25kt. Exports
of FDY were flat on the
month and those of DTY
slightly advanced over
April.
The daily chart shows that
cotton price has been moving
sideways in the past few months.
The price has remained between
the important support level at
$76.20 and the resistance point
at $88.62. As a result, the price is
hovering at the 25-day and 50-day
moving averages.
Most importantly, the Average
True Range (ATR) has dropped
to a low of 1.71, the lowest level
since September 2021. The ATR is
an important figure since it is the
most popular measure of volatility
in the market.
Therefore, cotton prices will
likely continue consolidating in the
coming days. A bullish breakout
will be confirmed if it moves above
the key resistance level at $88.62.
A move below the support at $80
will invalidate the bullish view.
Source: Invezz
China’s PFY exports to India hit record high in May

9
Affected by the BIS
certification, the procurement from
Indian buyers rapidly increased in
May-Jun and Chinese companies
were active in selling. Exports
of PFY to India approached 74kt
in May, hitting historic new high,
accounting for 20.3% of the total.
PFY exports are expected to be
high in Jun too. In addition, the BIS
certification which is supposed to
be implemented in Jul is heard to
be delayed into the end of 2023,
while this news has not been
confirmed.
Affected by the heat
temperature in Jun, many industrial
parks in nations like Vietnam and
Bangladesh faced power rationing
or power outage and companies
saw unstable production, which
impacted their procurement of
raw materials to a certain extent.
Orders from Bangladesh were
modest recently and exports of
PFY to Bangladesh may be low in
Jun.
AffectedbytheBIScertification
of India, the PFY exports may
remain high in China in Jun. If the
BIS certification is implemented
as scheduled on Jul 3, PFY
exports may start falling after Jun.
However, factoring into the price
and quality advantage of China-
made PFY, sequent PFY exports
may sustain high compared with
previous years.
If India postpones the
implementationofBIScertification,
the PFY exports are estimated to
be more optimistic in the second
half of 2023. In long run, as it is
difficult to reverse the transfer
trend of domestic textile industry,
exports of China-made PFY are
expected to remain good.
Source: CCFGroup

10 https://vcosa.vn
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11
A
ccording to the Vietnam
Macroeconomic Update
Report, retail sales
increased 11.5% in May 2023
compared to the same period in
2022, equivalent to the growth rate
in the previous April. Merchandise
sales improved from 9.7% in April
to 10.9% in May. Service revenue
growth slowed from 19.2% in April
to 7.6% in May.
Merchandise exports in May
also reached 6%, lower than
in 2022 due to weak external
demand. Imports fell by 18.4% in
May 2023, reflecting the dwindling
demand for input materials by
both FDI and domestic firms. This
shows that production and export
activities will continue to progress
slowly in the coming months.
Consumer Price Index (CPI)
inflation recorded a fourth
consecutive month of decline,
from 2.8% in April to 2.4% in May
due to global energy prices and
domestic transport costs. reduce.
Core inflation is still quite high
when recorded at 4.5% in May,
almost on par with 4.6% in April.
In May 2023, committed
capital flows from foreign direct
investment (FDI) also slowed
down as global uncertainties
continued to affect investor
confidence. Disbursed FDI in May
this year only reached 1.8 billion
USD (USD), equivalent to 2022. The
State Bank of Vietnam has cut the
refinancing interest rate from 5.5%
to 5. % and overnight lending rate
from 6% to 5.5%. This is the third
rate cut in a row since March 2023.
Credit growth continued to slow,
falling from 9.2% in April 2023 to
9% in May, reflecting weakening
demand.
The budget balance recorded a
rather large deficit, about 2 billion
USD in May 2023. Budget revenue
decreased by 35.8%, reflecting
the impact of high post-COVID
revenues from revenues related to
land, property, etc. Public spending
also increased by 27.8% in May
2023.
Facing this situation, the
representative of the World Bank
recommended that external
demand continues to be weak
and global uncertainties are
having an adverse impact on the
economy, leading to shrinking
exports and imports, and industrial
production. industry slows down.
While domestic consumption (as
reflected in retail sales) remains
solid and comparable to pre-
pandemic growth, credit growth
continues to slow, reflecting weak
credit demand.
Intheeventthatglobalfinancial
conditions tighten, external
demand could weaken further.
Northern Vietnam began to suffer
from a shortage of electricity for
consumption and production at the
end of May, which, if not resolved
in time, could affect the economy.
When inflation showed signs
of slowing down, the State Bank
of Vietnam (SBV) loosened
monetary policies to support the
economy. However, the monetary
policy governing body needs to
closely monitor the difference in
the direction of monetary policy
in Vietnam compared to other
countries, which may create
pressure on capital flows and
exchange rates. Accelerating
public investment disbursement
(including national target
programs) will support aggregate
demand and economic growth
in the short term. At the same
time, prioritizing investments in
digital and green technologies,
infrastructure and human
resources will help promote long-
term sustainable development.
While manufacturing exports
slow downand manufacturingjobs
suffer, World Bank experts say
it’s important to quickly identify
and support these workers and
workers. affected households
through the social protection
system.
Streamlining administrative
procedures and removing
regulatory barriers will help
spur the business activities and
investments needed for economic
growth.
Source: Vietnam.postsen
WB: Vietnam’s inflation shows signs of slowing down
NATIONAL NEWS

12 https://vcosa.vn
T
his means that Vietnam jumped
67 places in the world ranking of
export value from 1988 to 2021,
with an increase of more than 289
times.
In 2022, Vietnam’s export value
is expected to reach about US$371.5
billion, ranking 21st in the world.
Compared to 2021, this is a jump of
two levels, and compared to 1988,
this is a jump of 69 steps on the world
scale.
Thus, Vietnam has risen from 90th
to 21st position in the world ranking
of export value from 1988 to 2022,
approaching the top 20 globally.
In terms of ASEAN countries alone,
Vietnam’s export value will continue
to rank second in 2022, behind only
Singapore, which has the largest
import-export turnover in ASEAN with
about US$1,028 billion.
Vietnam has climbed 69 spots in the global export value ranking,
from 90th out of 126 to 21st, and is close to breaking into the top 20
Vietnam has achieved remarkable growth in export value over the past three
decades. According to World Bank data, Vietnam’s export value was only about
US$1.01 billion in 1988, ranking sixth in ASEAN and 90th in the world. By 2021, it had
increased to about US$292.48 billion, ranking second in ASEAN and 23rd in the world.
Vietnam’s export turnover in the period 1988-2022. Source: WB

13
Malaysia will rank third with about US$353 billion, followed by Indonesia with about US$291.98 billion and
Thailand with about US$287.07 billion. The Philippines will rank sixth with about US$78.84 billion.
Vietnam has also shifted
export structure from raw
exports to highly processed and
technological goods. Moreover,
Vietnam has expanded export
markets from more than 20
countries in 1991, mostly in the
Asia-Pacific region, to more than
230 countries and territories
by 2021.
Vietnam has also established
trade relations with all
industrialized countries (G7),
major economic regions and other
global economic and financial
institutions.
In addition, Vietnam has been
very active in signing free trade
agreements (FTAs) to facilitate
export activities. As of May 2023,
Vietnam has signed 15 FTAs that
are in effect, one FTA that has
been negotiated and three FTAs
that are under negotiation.
Source: Economic times
Export turnover of Asean countries in the period 1988-2022.
Source: WB
During the period 1988 - 2022,
Vietnam’s export value jumped from
6th to 2nd in ASEAN. Along with that,
the export value of Vietnam increased
by 367.82 times. Vietnam is the
country with the largest increase in
export value in the period 1988 - 2022.
Vietnam’s impressive export
performance reflects strong growth
and development over the years.
Vietnam has diversified export
products from seven items with over
US$500 million in turnover (including
rice, footwear, textiles, crude oil, coffee,
electronic goods, aquatic products)
to 35 items with over US$1 billion
in turnover, accounting for 93.8% of
total export turnover. Among them,
eight items have over US$10 billion in
turnover, accounting for 69.7%.

14 https://vcosa.vn
V
ietnam has continued
to be excluded from the
US Department of the
Treasury’s monitoring list of
currency manipulators in its
latest report on macro-economic
and foreign exchange policies of
major trading partners of the US.
The State Bank of Vietnam
(SBV) said that the report,
released on June 17, continued
to base on three criteria to make
assessments, namely trade
surplus with the US, current
account surplus, and persistent
and one-sided intervention in the
foreign currency market.
Inthereport,theUSDepartment
of the Treasury placed seven
economies on the monitoring list
of major trading partners that merit
close attention to their currency
practices and macro-economic
policies, comprising China, the
Republic of Korea, Germany,
Malaysia, Singapore, Switzerland,
and Taiwan (China).
It also found that no major
trading partner manipulated
currency during the period from
January to December 2022. During
the period, Vietnam exceeded only
one of the three criteria, on trade
surplus, so it was excluded from
the monitoring list.
The SBV said that at bilateral
meetings with the central bank
of Vietnam, the US Department
of the Treasury continued highly
valuing the SBV’s governance
of the monetary and foreign
exchange policies, which have
managed to sustain stability of
the financial market, the monetary
market, and the macro-economy
amid numerous difficulties and
challenges.
The SBV has repeatedly
affirmed the consistent target of
Vietnam’s monetary and foreign
exchange policies is to help control
inflation, stabilise the macro-
economy, and ensure safety for
credit institutions. It has been
making efforts
to gradually
modernise and
promote the
transparency of
the monetary
and foreign
exchange policy
frameworks.
The bank has
governed foreign
exchange rates in
a proactive and
flexible manner
that matches the
development level
of its foreign exchange market
and economic factors. It has not
used the foreign exchange policy
to create an unfair competitive
edge while ensuring the foreign
exchange market’s stable and
smooth operations to help with
macro-economic stability.
It added that it will continue
governing the monetary and
foreign exchange policies in
the abovementioned manner
and actively coordinating with
ministries and sectors to work on
the issues of the US side’s concern
in the cooperative and goodwill
spirit.
Source: Vietnamplus
Vietnam remains out of currency manipulation watch list of US
The headquarters of the State Bank of Vietnam
in Hanoi (Photo: congthuong.vn)

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produce flawless quality with the highest possible production speed.
Selecting the best ringtraveler system is crucial here. ORBIT allows
exceptional speeds above 23 000 rpm without compromising quality.
When the spindle speed is increased, the frictional power between
the ring and the traveler, and thus the heat generation, increases
exponentially. When speeds are too high, C-shaped travelers are therefore
thermally damaged and fail.
Increase in speed and production
The ORBIT features a large contact surface between the ring and the
traveler (Fig. 1), which is four to five times bigger than that of a T-flange
ring. This drastically reduces the pressure and thus the heat generation.
It also provides more stable running conditions and allows the traveler
weight to be reduced, so speeds above 23 000 rpm can be reached.
The size of the yarn passage also plays an important role (Fig. 1),
especially when processing man-made fibers which are prone to heat
damages. The ORBIT ringtraveler system benefits from a large yarn
passage which minimizes thermal damages for better yarn quality.
Zero compromise on quality
The large contact area of ORBIT between the ring and traveler
contributes to the gentle handling of fibers. The stable running
conditions coupled with the reduced surface pressure and the optimal
heat conduction result in low yarn breakage rates. Recent tests (Fig. 2)
conducted at spinning mills across the world confirm that even at higher
speeds, the ORBIT shows better results in yarn quality than traditional
systems.
Often imitated but never duplicated, the ORBIT ring-traveler system
(Fig. 3) is the reference for spinning at the highest speed. With a wide
scope of applications for all kinds of fibers, with yarn counts between
Ne 20 and Ne 80, the ORBIT ring-traveler system is the solution to reach
higher production and, in some cases, even better quality.
The reference to spin faster and better
Trade Press Article
ORBIT ring-traveler system
About Rieter
Rieter is the world’s leading supplier of systems for short-staple
fiber spinning. Based in Winterthur (Switzerland), the company
develops and manufactures machinery, systems and components used
to convert natural and man-made fibers and their blends into yarns.
Rieter is the only supplier worldwide to cover both spinning preparation
processes and all four end-spinning processes currently established
on the market. Furthermore, Rieter is a leader in the field of precision
winding machines. With 17 manufacturing locations in ten countries,
the company employs a global workforce of some 4 900, about 18%
of whom are based in Switzerland. Rieter is listed on the SIX Swiss
Exchange under ticker symbol RIEN. www.rieter.com
About Bräcker
Bräcker, the world’s leading supplier of rings and travelers for ring
spinning systems, is a subsidiary of the Rieter Group. Bräcker, based
in Pfäffikon ZH (Switzerland), creates customer value through system
expertise, innovative solutions, after sales excellence and global
presence. The company manufactures its main products – rings and
travelers for ring spinning machines – in Pfäffikon and Wintzenheim
(France). In addition, Bräcker offers grinding machines used for
maintenance of cots. www.bracker.ch
Rieter Management AG
Klosterstrasse 32
P.O. Box
CH-8406 Winterthur
T +41 52 208 71 71
F +41 52 208 70 60
www.rieter.com
For further information,
please contact:
Rieter Management AG
Media Relations
Relindis Wieser
Head Group Communication
T +41 52 208 70 45
F +41 52 208 70 60
media@rieter.com
www.rieter.com
Fig. 1: With its large yarn passage (1)
and contact area (2), the design of the
ORBIT ring-traveler system allows
exceptional speeds above 23 000 rpm
without compromising quality.
PP-ID: 96537
Fig. 3: ORBIT allow speeds
above 23 000 rpm without
ever compromising on quality.
PP-ID: 96499
Fig. 2: Recent tests conducted at spinning mills across the world
confirm that even at higher speeds, the ORBIT shows better results
in yarn quality than traditional systems.
Rieter Trade Press Article: ORBIT Ring/Traveler System, April 2022
PP-ID: 96565
PP-ID: 96566
PP-ID: 96567

18 https://vcosa.vn
VCOSA’S ACTIVITIES
VCOSA’S ACTIVITIES
VCOSA joined the quarterly online meeting with Board IV and industry associations on June 2, 2023,
to discuss the macroeconomic and business environment and share ideas on how to support private
enterprises in facing various challenges.
VCOSA welcomed Gherzi, a Swiss consulting firm for the textile, garment, supply chain management, and
logistics industries, as an Affiliate member on June 12, 2023. Gherzi is preparing to open its representative
office in Vietnam soon.
VCOSA’s Chairman, Mr. Nguyen An Toan, was present at the ribbon-cutting ceremony for the 2nd
International Exhibition “China Home Life Vietnam 2023”. This event, held from June 15 to 17, 2023, at
the Saigon Exhibition and Convention Center (SECC), displayed a range of Chinese textiles, garments,
equipment, tools, technology. The exhibition was a joint effort between the Vietnam Chamber of Commerce
and Industry - Ho Chi Minh City Branch (VCCI-HCM), Shenzhen Meorient International Exhibition Company,
and Minh Vi Exhibition and Advertisement Services Co., Ltd.
On June 23, 2023, VCOSA’s Ho Chi Minh Office hosted representatives from H.R. Agritech, an Indian
company specializing in cotton. The company expressed interest in learning about Vietnam’s spinning
companies and exploring collaboration opportunities through VCOSA.
That same day, VCOSA’s Vice Chairman and Secretary General, Ms. Do Pham Ngoc Tu, attended the 247th
U.S. Independence Day celebration at the Sheraton Saigon Hotel, upon invitation from the U.S. Consulate
General in Ho Chi Minh City.
Looking ahead, VCOSA is planning a business trip to Hangzhou, China to participate as a speaker at the
“China Cotton Textile Forum 2023” conference organized by CCFGroup on July 5-6, 2023. Concurrently,
preparations are underway for the “Preliminary of the Spinning Industry for the First Half of 2023”
conference, slated for July 7, 2023, in Thai Binh.
Mr. Nguyen An Toan, was present at the ribbon-cutting ceremony for
the 2nd International Exhibition “China Home Life Vietnam 2023”.
Photo: VCOSA
Ms. Do Pham Ngoc Tu, attended the 247th U.S.
Independence Day celebration. Photo: VCOSA

19
Warmly welcome new member joining VCOSA in June 2023:
GHERZI ORGANIZATION
Phu Tho Textile Company
Limited has been removed
from the “List of Unfulfilled
Awards 2” (LOUA 2).
---------
This represents a step
towards fairness in the cotton
trade rules and the progress of
the Vietnamese spinning industry.
O
n June 26, 2023, Phu Tho Textile Company
Limited (Phu Tho), owned by Mr. Nguyen Van
Ha, who is also the CEO, located at Thuy Van
Industrial zone, Thuy Van commune, Viet Tri City, Phu
Tho Province - one of the major spinning producers
in the North, and an active member of the Vietnam
Cotton and Spinning Association (VCOSA) - was
removed from the LOUA 2 of the International Cotton
Association (ICA), which is a list of companies proven
to have links to one listed on LOUA 1. LOUA 1 is a
public list that identifies companies that have failed
to comply with one or more arbitral awards under the
ICA’s Bylaws and Rules.
Phu Tho has a capacity of more than 59,000
spindles and can supply 11,000 tons of yarn per year
from cotton, PE to blended yarn (CVC, TCD) for both
domestic and international markets. From March 2023 to
June 2023, Phu Tho cooperated with VCOSA to provide
complete information and legal documents to prove
the company’s eligibility to be removed from LOUA
2. The VCOSA actively supported the investigation
process and worked closely with all parties to achieve
the goal and shorten the processing time. This effort
of VCOSA demonstrates the strategic vision and deep
commitment of Phu Tho’s Board of Directors to enhance
the company’s reputation and competitive capacity.
Being removed from ICA’s LOUA 2 not only marks an
important milestone in the company’s history but also
demonstrates Phu Tho’s continuous efforts to enhance
its reputation and expand and build relationships in
both domestic and international markets. It can be said
that this is a step
forward for the
V i e t n a m e s e
s p i n n i n g
i n d u s t r y ,
affirming the
fairness and
transparency of
the ICA.
Indeed, in
recent years,
the VCOSA has
s i g n i f i c a n t l y
contributed to helping the Vietnamese spinning industry
enhance its competitive capacity and recognition. The
relationship between VCOSA and ICA is increasingly
strengthened through activities aimed at protecting the
rights and interests of members of both organizations.
The ICA actively listens to and improves its Bylaws and
Rules to optimize safety, fairness, and transparency in
global cotton trade transactions, while VCOSA regularly
seeks opinions and contributions from its members to
organize programs that support Vietnamese spinning
businesses to enhance their competitive capacity,
protect their rights and interests when engaging in
cotton trade transactions.
Congratulations to Phu Tho on being removed
from ICA’s LOUA 2, and hopefully, this will inspire and
motivate other Vietnamese spinning industry partners
to continue developing and improving the company’s
reputation.
DEVELOPMENTAL AND SUPPORTIVE
ACTIVITIES FOR MEMBERS

20 https://vcosa.vn
REPORT AND DATABASE
Compared to the previous
month, the import volume of
cotton, fiber and yarn rose by
17.5% and 6% respectively in May
2023. However, these two items
saw a decline in the first 5 months
of 2023 compared to the same
period last year.
The cotton import volume
in this period was 512 thousand
tons, a 12.8% drop from last year,
while the value fell more sharply by
25.4% to 1,163.7 million USD. The
import volume of fiber and yarn
was 414.5 thousand tons in this
period, a 10% decrease from last
year; the value also declined by
24.6% to 876.3 million USD
Preliminary statistics show
that in May 2023, Vietnam
imported 145.8 thousand tons
of cotton, up 17.5% over the
previous month. Similarly, the
import of fiber and yarn of also
increased by 6.0%, reaching 89.4
thousand tons.
Import turnover of items
related to the textile and garment
industry in May 2023 increased
compared to the previous month.
Specifically, cotton increased by
12.8% (US$311.7 million) and
textile fibers also increased by
12.8% ($196.7 million), imported
fabrics increased by 4.0%
(US$1,196.7 million). Similarly,
accessories increased by 8.2%
($525.3 million).
1.Monthly Import Statistics

21
The import turnover of items related to Vietnam’s
textile and garment industry in the first 5 months of
2023 witnessed a decline compared to the same
period last year. Notably, cotton experienced the
largest decrease, with a drop of 25.4% amounting
to $1.16 billion. The import of textile fiber and yarn
amounted to $876.3 million, down 24.6%. Additionally,
the import of fabrics of all kinds reached $5.33 billion,
reflecting a decrease of 19.9%. Moreover, the import
of accessories decreased by 18.5%, totaling $2.39
billion.
Preliminary statistics
show that in May 2023,
Vietnam’s imports of fiber
and yarn were about 89.4
thousand tons. Compared
to the previous month, this
import volume increased by
6%, but compared to the same
period last year, this import
volume decreased by 12.6%.
In May 2023, Vietnam
imported 145.8 thousand
tons of cotton, up 17.5%
over the previous month
and up 20.6% over the
same period last year.

22 https://vcosa.vn
1.1. Import of cotton decreased by 21.5% in volume in the
first 4 months of 2023
Vietnam’s cotton imports
Source: VITIC
In April 2023, the price of cotton imported into
Vietnam stood at $2,226 per ton, reflecting a 2.5%
decrease compared to March 2023 and a 20.2%
decrease compared to April 2022. This marks the
eighth consecutive month of declining prices for raw
cotton imports into Vietnam since reaching a peak in
August 2022.
On average, during the first four months of 2023,
the price of imported cotton materials in Vietnam
was approximately $2,327 per ton. This represents
an 11.1% decrease compared to the same period in
2022.
In the first four months of 2023, Vietnam
imported 366.18 thousand tons of
cotton, valued at USD 851.96 million.
This represents a decrease of 21.5% in
volume and 30.2% in value compared to
the same period in 2022.
The United States emerged as the
largest source of cotton imports for
Vietnam during this period, with 125
thousand tons imported, valued at 289
million USD. This represented a 7.8%
decrease in volume and a 26.6% decrease
in value compared to the same period
in 2022. These imports accounted for
34.2% of Vietnam’s total cotton imports.
Notably, in April 2023, cotton imports
from the US reached 71.16 thousand tons, worth
162.22 million USD, showing a significant increase of
110.6% in volume and 108.9% in value compared to
March 2023, and a substantial increase of 67.5% in
volume and 32.5% in value compared to April 2022.
Australia ranked second in terms of cotton
imports, with an import volume of 95 thousand tons,
valued at 230 million USD. This marked a substantial
increase of 108.7% in volume and 95.9% in value
comparedtothesameperiodin2022.However,inApril
2023, cotton imports from Australia declined to 16.49
thousand tons, worth 37.65 million USD, representing
a decrease of 29.7% in volume and 32.3% in value
compared to March 2023. Nevertheless, these figures
still reflected a remarkable increase of 788.6% in
volume and 563.6% in value compared to April 2022.
Import volumes from other markets, such as India,
Argentina, and Ivory Coast, decreased significantly in
the first four months of 2023 compared to the same
period in 2022. Specifically, imports from the Indian
market decreased by 75.7%, imports from Argentina
decreased by 91%, and imports from Ivory Coast
decreased by 94.9%.
Source: VITIC
Vietnam’s cotton imports in 2022-2023 (thousand tons)

— All data are accurate, relevant and verified from sources: the Ministry of Industry and
Trade, General Department of Vietnam Customs, General Statistics Office of Vietnam,
International Trade Center, Cotton Incorporated and other reliable sources.
— This text provides general information. VCOSA assumes no liability for the information
given being complete or correct. Due to varying update cycles, statistics can display
more up-to-date data than referenced in the text.
Communication and Information Department.
23
The global cotton market is currently experiencing an abundance of supply and low international demand.
This is primarily due to slower growth in garment demand compared to previous years, which can be attributed
to high inflation in many countries worldwide.
In April 2023, the average
price of imported cotton from
major markets in Vietnam
experienced a decrease
compared to March 2023.
Specifically, the price of
cotton imported from Brazil
decreased by 0.7% to USD
2,427 per ton, while the price
of cotton imported from the
US market decreased by 0.8%
to USD 2,280 per ton.
Import price of cotton
Source: VITIC
The average import price of cotton in 2022-2023 (USD/ton)

24 https://vcosa.vn
Despite the low world
cotton price, the import of
cotton into Vietnam is not
expected to experience
significant growth in the
near future. This is primarily
due to weak domestic
demand in Vietnam.
US cotton price in 2022-2023 (USD/pound)
Source: macrotrends.net
1.2.Theimportoffiberisprojectedtocontinueitsupwardtrendin
theforeseeablefuture
According to the General
Department of Customs,
Vietnam’s imported fiber n April
2023 totaled 36.23 thousand tons,
valued at 49.89 million USD. This
represents an 11.4% decrease in
volume and a 2.7% decrease in
value compared to March 2023.
However, it is worth noting that
there was a significant increase
of 28.3% in volume and 22.9% in
value compared to April 2022.
Overall, in the first four months
of 2023, Vietnam imported 131
thousand tons of fiber, worth 169
million USD. This indicates a 4.8%
increase in volume but a 1.3%
decrease in value compared to the
same period in 2022.
During the first four
months of 2023, Vietnam
imported fiber from 29
markets, which is an
increase of four markets
compared to the same
period in 2022.
China remained the
largest supplier of fiber to
the Vietnamese market.
In April 2023, Vietnam
imported 17.12 thousand
tons of fibers from China,
worth 19.89 million USD.
This represents a 17.3%
decrease in volume and a 17.8%
decrease in value compared to
March 2023, but a 35.3% increase
in volume and a 19.7% increase
in value compared to April 2022.
of 2023, Vietnam imported 62.27
thousand tons of fiber from
China, worth 71.98 million USD,
accounting for 47.5% of total
imports. This indicates a 14.1%
increase in volume and a 3%
increase in value compared to the
The second-ranked market
for fiber imports was Thailand.
In April 2023, Vietnam imported
3.8 thousand tons of fibers from
Thailand, worth 4.38 million USD.
This represents a 3.2% decrease
in volume but a 2.1% increase
in value compared to March
2023, and a 90.2% increase in
volume and a 52.7% increase in
of 2023, Vietnam imported 16.42
thousand tons of raw fibers from
Thailand, worth 18.43 million USD,
accounting for 12.5% of Vietnam’s
total fiber imports. This indicates a
28% increase in volume and a 4.9%
increase in value compared to the
Overall, during the first four
months of 2023, raw fiber imports
to Vietnam increased from most
supplying markets, except for the
Korean market, which experienced
a 36.8% decrease in volume. It is
worth noting that the import of
fiber from certain markets, such as
Bangladesh, Japan, and Slovenia,
saw a significant increase during
this period.
Vietnam’s fiber imports in 2022-2023 (thousand tons)
Source: VITIC

25
Source: VITIC
Vietnam’s fiber imports
In April 2023, the price of imported fiber to
Vietnam reached an average of 1,377 USD/ton,
up 9.8% compared to March 2023 but down 4.2%
compared to April 2022. In which, the price of fiber
imported from Thailand is the lowest at 1,152 USD/
ton; followed by China at $1,162/ton… and the
highest import price from the Korean market was at
$2,131/ton.
The world fiber market is still in a downtrend due
to low demand from the textile industry. However, the
market is optimistic because there is a lot of positive
information from fiber mills that have received orders
for fiber supply to increase again. These orders were
redirected slightly higher after the recent increase in
the price of cotton on the ICE.
In China, according to a source from the Global
Textile Network Information Center (https://www.
tnc.com.cn/info/), polyester fiber prices have fallen
in recent days, and reached a level 7,275 yuan/
ton on May 24, 2023, at the same time on April 24,
2023 reached 7,425 yuan/ton, but still much higher
than the last level on May 16, 2023 at 7,190 yuan/
ton; Meanwhile, the average price of viscose fiber in
China reached 13,250 yuan/ton as of May 24, 2023,
the price has been stable since May 8, 2023, but still
higher than the price level of April. 2023.
The average import price of fiber in 2022-2023 (USD/ton)
Source: VITIC

26 https://vcosa.vn
Amidst a flourishing
market demand, the price
of imported fiber has
seen a notable increase in
Vietnam during April 2023.
The last two months have
also seen a sharp rise in
the import volume of fiber
when the world price of
imported fiber began to
trend down.
With the forecast that
the world fiber price will
remain low, while there are
many optimistic signals
from the textile and
garment export orders,
it is forecasted that the
amount of fiber imports
into Vietnam will continue
to increase in the coming
time. In the future, textile
and garment enterprises
need to follow up to
increase imports to serve
production.
Import price of fiber
Source: VITIC
1.3. Imports of yarn dropped sharply
According to statistics of the General Department
of Customs, Vietnam’s import of yarn in April
2023 reached 45.16 thousand tons, worth 127.66
million USD, down 22.7% in volume and 20.1% in value
compared to March 2023, down 22.3% in volume and
30.2% in value compared to April 2022. Generally, in
the first 4 months of 2023, imports of this item to
Vietnam reached 182.21 thousand tons, worth 509.92
million USD, down 24.8% in volume and down 31% in
value over the same period last year 2022.
In the first four
months of 2023,
China has remained
the largest supplier of
yarn to Vietnam, with
an import volume of
126.2 thousand tons
worth $317.92 million,
accounting for 69.3% of
total imports. Despite
a decline of 16.2% in
volume and 24.6% in
Source: VITIC
Vietnam’s yarn imports in 2022-2023 (thousand tons)

27
Source: VITIC
value over the same period in 2022,
China’s supply still dominates.
In April 2023 alone, the amount
of imported yarn from China to
Vietnam was 31.56 thousand tons
worth 82.69 million USD, down
21.7% in volume and 16.2% in
value from March 2023, and down
13.3% in volume and 22% in value
from April 2022.
Taiwan is the second supplier
of yarn to Vietnam in the first 4
months of 2023, with the import
volume reaching 18.21 thousand
tons, worth 49.78 million USD,
accounting for 10% of the total
import volume of yarn to Vietnam,
down 45.8% in volume and 46.2%
in value over the same period
in 2022. In April 2023 alone, the
import of yarn from Taiwan market
to Vietnam reached 3.85 thousand
tons, worth 10.35 million USD,
down 33.9% in volume and 36.6%
in value compared to March 2023;
down 56% in volume and 55.9% in
In general, yarn imports from
major markets into Vietnam have
decreased sharply in the first four
months of 2023, except for the
Japanese market which increased
by 21% in volume.
However, it is worth noting that
the import volume of yarn from
some markets, such as Pakistan
and France, has increased
significantly in the first four
months of 2023.
Vietnam’s yarn imports
Import price of yarn in April 2023 was at
US$2,827/ton, up 3.3% compared to March 2023 but
down 10.2% compared to April 2022.
In the first 4 months of 2023, the average import
price of raw materials into Vietnam reached $2,799/
ton, down 8.2% over the same period in 2022.
The average import price of yarn in 2022-2023 (USD/ton)
Source: VITIC

28 https://vcosa.vn
In April 2023, the lowest price
of yarn imported from China was
$2,620 per ton, followed by Taiwan
at $2,687 per ton. The highest
import price from Hong Kong was
$8,626 per ton.
The global yarn market
is currently experiencing an
oversupply and weak demand,
causing raw material prices to
continue declining.
According to the Global Textile
Network Information Center,
polyester yarn prices in China fell
to 7,190 yuan per ton on May 31,
2023, down from 7,425 yuan per
ton in the previous month.
The average price of 10S
cotton yarn in China reached
16,270 yuan per ton as of May 31,
2023, remaining stable since May
22, 2023. This price is higher than
the level achieved in April 2023,
which was 15,930 yuan per ton.
In Vietnam, the price of
imported yarn has increased, but
due to weak market demand, the
amount of yarn imported into
Vietnam remains low. Although the
world price of yarn has decreased,
Vietnamese enterprises should
closely monitor the situation to
determine the most suitable time
and quantity for purchasing raw
materials in the near future.
Import price of yarn
Source: VITIC
Vietnam’s exports of fiber and yarn in May 2023
compared with the previous month had a growth
of 11.2% in volume (160.3 thousand tons) and 9.5% in
value (390.8 million USD).
However, compared with the same period last
year, Vietnam’s fiber and yarn exports in the first 5
months of 2023 decreased by 6.1% in volume (678.3
thousand tons) and sharply decreased by 28.8% in
value ($1,688.3 million).
2.Monthly Export Statistics

29
In May 2023, the export of fiber
and yarn reached US$ 390.8 million
(up 9.5%) compared to the previous
month.
However, other items such
as fabric and technical textile
all decreased, reaching 192.1
million USD (down 4.4%) and 52.2
million USD (down 6.7%). Export
of accessories increased by 0.4%,
reaching 161.7 million USD.
Vietnam’s fiber exports in
May 2023 achieved good growth
compared to the previous month.
Specifically, the export
volume increased by 11.2% over
the previous month, reaching
160.3 thousand tons. Export
value also increased by 9.5%,
reaching 390.8 million USD.
Textile and
garment exports in
May 2023 reached
$2.916 billion, up
14.8% over the
previous month.
According to
preliminary statistics
in May 2023, Vietnam’s
textile and garment
exports reached
$2.916 billion, down
6.4% over the same
period last year.

30 https://vcosa.vn
Vietnam’s exports of textiles and garments in the
first five months of 2023 all decreased compared to
the same period last year. Fiber and yarn reached
1.688 billion USD, down 28.8%, this is the largest
commodity group and also the largest decrease in
turnover compared to the same period last year. Other
items such as fabrics, accessories and technical
textile all decreased by -15.7%, -17.8% and -24.0%,
respectively.
Based on statistics from
the General Department of
Customs, Vietnam’s fiber and
yarn exports in May 2023 reached
160.3 thousand tons, generating a
turnover of 390.8 million USD. This
shows growth of 11.2% in volume
and 9.5% in turnover compared to
April 2023 and a 17.6% increase
in volume but a 10.9% decrease
in turnover compared to May
2022. Overall, in the first five
months of 2023, Vietnam exported
678.3 thousand tons of fiber and
yarn worth 1.688 billion USD,
experiencing a 6.1% decline in
volume and a significant 28.8%
decrease in turnover compared to
the same period last year.
As of now, cotton and fiber
prices are on a decline which
indicates a decrease in fiber
and textile product prices.
Furthermore, as global orders for
garments increase, specifically in
the markets of Bangladesh, India,
and Turkey, there will be a surge in
the demand for production input
materials such as fiber, yarn, and
fabric. Hence, Vietnam’s export
of fiber and yarn is predicted to
continue its recovery in the near
future.
In the first five months of
2023, Vietnam’s main market for
fiber and yarn exports was found
in China, accounting for 50.7% of
the total volume and 55.3% of the
total export value for this item. The
remaining markets only accounted
for 1-7%, depending on each
individual market.
During this time, export to
China decreased by 9.5% in volume
and 29.3% in turnover compared to
the same period in 2022, due to
2.1. Fiber and yarn exports are expected to bounce back soon
Source: VITIC
Vietnam’s fiber and yarn exports in 2022-2023 (million USD)

31
The Indonesian market witnessed the highest increase, with prices going up by 11.9%. When compared
to May 2022, the average export price of Vietnam’s fiber and yarn to different markets in May 2023 mostly
showed double-digit decreases.
Source: VITIC
In May 2023, the
average export price
of fiber and yarn from
Vietnam to various
markets experienced a
decline compared to April
2023. Notably, the export
price to the Cambodian
market saw the largest
decrease, down by 15.2%.
However, there were still
some markets where the
average export price of
Vietnamese fiber and yarn
increased.
Vietnam’s fiber and yarn export
Source: VITIC
Export price of fiber and yarn 2022-2023 (USD/ton)
a significant drop in exports at the start of the year
when China was just reopening. However, Vietnam’s
exports of fiber and yarn to China saw an increase
again in May 2023. The export volume reached
81.32 thousand tons, with a turnover of 216 million
USD, indicating an upturn of 21.3% in terms of export
volume and a 19.5% increase in turnover compared to
April 2023, and a 30.9% increase in volume and 5.9%
increase in turnover compared to May 2022.

32 https://vcosa.vn
Source: VITIC
Export price of fiber and yarn
In May 2023, the average export price of
Vietnam’s fiber and yarn was $2,438 per ton, showing
a 5.4% decrease compared to April 2023 and a 24.2%
decrease compared to May 2022. Overall, during the
first five months of 2023, the average export price of
Vietnam’s fiber and yarn was $2,489 per ton, reflecting
a 24.2% decline compared to the same period in 2022.

33
Source: CI
A
fter three years of drought,
significant rainfall finally
arrived in West Texas. In
certain areas, precipitation was
heavy enough to cause flooding.
While flooding may have a
detrimental impact on some farm
operations, the arrival of rain has
already caused projections for
abandonment to decrease.
The USDA lowered its national
abandonment figure by 700,000
acres month-over-month, dropping
its forecast abandonment rate for
the U.S. from 23% (May figure) to
16% (June figure). As the season
progresses, additional rain will be
needed to support plant health, but
recent precipitation will encourage
germination and any moisture
accumulated within the soil will be
beneficial.
The weather will remain an
importantvariabletowatchinother
major growing regions. In China,
there were some challenging
conditions early in the season,
and the crop is expected to be
smaller than one year ago due to a
combination of lower acreage and
yield (27.0 million bales in 2023/24
versus 30.7 million in 2022/23).
The Indian government just
announced a 9-10% increase in the
minimum support price for cotton
(guarantees vary by quality).
Despite the addition, Indian
acreage is expected to fall due
to price-related competition
from other commodities (USDA
forecasting a 5% drop in Indian
planting, but Indian production is
expected to increase 2% due to a
forecast calling for higher yields).
The monsoon season, which
brings most of India’s annual
rainfall, just got underway. This
year’s monsoon arrived a little later
than usual, and Indian government
projections suggest slightly less
accumulation than the long-term
average. Pakistan has suffered
from recent hailstorms, but the
crop has otherwise been reported
to have been progressing well
so far this season. The USDA
indicates the Pakistani harvest
will be two million bales larger
than last crop year’s flood-affected
figure (5.9 million bales in 2023/24
versus 3.9 million in 2022/23).
As the weather unfolds,
understanding of the global
supply situation will improve.
More persistent questions for the
market will likely come from the
demand side of the market. Global
economic growth is expected to
be sluggish and there have been
widespread reports of inventory
accumulation throughout supply
chains.
Source: CI
3.Cotton Outlook

Newsletter May-2023
Head Office
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Ho Chi Minh city
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Ha Noi city
Office (mailing address)
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VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 06/2023 ISSUE

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