VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 08/2022 ISSUE

Bản tin tháng 8-2022
MONTHLY REPORT
MONTHLY REPORT
Cotton and Yarn Statistic
Cotton and Yarn Statistic
August 2022
Collected & Edited: Information & Communication Dept.
VietnamCottonandSpinningAssociation
---For internal circulation only---

2
www.vcosa.org.vn https://vietnamyarnprice.com
Newsletter August 2022
REMARKABLE INFORMATION

É The price of imported cotton is forecast to decrease

É It is forecasted that the import price of fiber will decrease

É The price of imported yarn is forecast to decrease

É Outlook for fiber and yarn exports remains positive

É International garment industry struggling to cope with US ban on Xinjiang cotton

É Africa’s cotton exports account for 16% global exports

É China’s PFY export may grow in H2 2022

É Big cotton exporter India likely to turn into net importer soon

É After reaching ‘peak cotton,’ a declining role for China

É Bumpy road ahead for 2022/23 cotton season

É The world’s cotton supply keeps shrinking, hit by drought, heat
DOMESTIC MARKET
GLOBAL MARKET
People harvest cotton in Xinjiang, China. Photo: Internet.

3
REFERENCE FROM NEWSPAPERS
I
nternational fashion industry
representatives have found
themselves in an unprecedented
situation as they are being forced
to make a hard choice between
cotton-related goods from China’s
Xinjiang region, a key global
supplier, and elsewhere, as a
result of the recent US import ban
on all Xinjiang-related goods due
to claims about “forced labor”.
The administration of US
President Joe Biden is trying to
crack down on Xinjiang cotton and
this has caused major problems
for global industry participants,
including those from countries in
Asia, which are major suppliers
for US garment companies. This
comes at a time when the global
supply chain is already facing
high raw material costs, logistical
hurdles and inflation, industry
insiders said.
AI Mamun Mridha, joint
secretary general of the
International garment industry struggling to cope with
US ban on Xinjiang cotton
Vietnamese firms will need to wean themselves
off raw materials produced in China’s Xinjiang
region in order to ensure long-term access to the
US market.
Regarding the impact of the Xinjiang cotton ban, the
issue mostly affects the garment manufacturers,
not spinners in Vietnam.
Ms. Do Pham Ngoc Tu
Vice Chairwoman, Secretary General of VCOSA
in an interview with Global Times

4
Bangladesh China Chamber of
Commerce and Industry (BCCCI),
told the Global Times in a recent
written interview that Bangladesh
is well aware of the US ban and is
monitoring the issue very closely.
“We are against any kind
of restrictions on free business.
Ultimately, the business
community and their consumer
base around the world suffers
badly due to this one-sided
decision,” Mridha said, noting that
the world is still suffering from
COVID-19 and the Russia-Ukraine
conflict, and the US move will
have a negative impact all over the
world, including Bangladesh.
While Bangladesh does not
import much cotton from Xinjiang,
almost 60-70 percent of the
country’s yarn and fabric comes
from China, the 2nd-largest
garment producer in the world,
according to the BCCCI.
“It’s very hard to differentiate
which yarn or fabric was or was
not manufactured using cotton
from China’s Xinjiang region ... we
are anxious about our supply chain
as it is heavily inclined toward
China and many of our members
are large garment and textile
manufacturers, so this decision has
put them under huge pressure,”
Mridha noted.
Mridha said that their main
markets for garment products are
in Europe, and the US also buys
garments from them.
Recently, the country passed
the $52 billion mark for exports,
and among that almost $42 billion
came from exports of garments
and textiles, according to the
BCCCI.
The Uyghur Forced Labor
Prevention Act (UFLPA), which
came into force on June 21 after
being signed into law by Biden
on December 23, 2021, assumes
that any product partly or wholly
made in Xinjiang, is linked to the
US hyped “forced labor” claim and
subject to an import ban.
While some global industry
representatives have managed to
find other sources of imports to
avoid falling victim to the ban, the
industry is still in a tough position
amid high inflation and rising cost
pressures.
In the ninth annual Fashion
Industry Benchmarking Study
recently released by the US
Fashion Industry Association
(USFIA), it shows that US fashion
companies are adopting a more
diverse sourcing base in response
to supply chain disruptions and
the need to mitigate growing
sourcing risks. But Asia remains
the dominant base of sources for
US fashion companies; eight of
the top 10 most-utilized sourcing
destinations are in Asia, led by
China, Vietnam, Bangladesh, and
India.
Reducing “China exposure” is
one crucial driver of US fashion
companies’ sourcing diversification
strategy, the USFIA said, especially
with the implementation of the
UFLPA.
The USFIA claimed that
one-third of their surveyed
respondents report sourcing less
than 10 percent of their apparel
products from China this year, but
the association admitted that over
95 percent of respondents said
they expect the UFLPA to affect
their sourcing.
Compared with finished
garments, US fashion companies’
textile raw material sourcing
seems less diversified.
Asia, particularly China,
continues to play a dominant role
as a textile supplier, especially for
fabrics and accessories, providing
93.8 percent and 87.5 percent
respectively of the respondents’
total imports, according to the
USFIA.
Vietnam, another major player
in the global fashion supply chain,
has also felt the impact of supply
chain disruption due to the US ban.
Do Pham Ngoc Tu, vice
chairperson and secretary general
of Vietnam Cotton & Spinning
Association (VCOSA), told the
Global Times that Vietnamese
firms will need to wean themselves
off raw materials produced in
China’s Xinjiang region in order to
ensure long-term access to the US
market.
Xinjiang produces 20 percent
of the world’s cotton. It is sent
to countries in Southeast Asia,
woven into a shirt or other piece
of clothing, and then shipped on to
the US - 16 percent of the clothing
in the US contains cotton fiber
from Xinjiang, Do Pham Ngoc Tu
noted.
In order to abide by the new
US law targeting China’s Xinjiang
goods, Vietnamese manufacturers
must prepare documents to prove
due diligence in evaluation of their
supply chain, and the manufacturer
must replace materials from
Xinjiang, or they must fulfill
corresponding documents.
Regarding the impact of the
Xinjiang cotton ban, the issue
mostly affects the garment
manufacturers, not spinners in
Vietnam, the vice chairperson said.
“But for apparel businesses,
finding new sources to replace
Chinese fabrics will prove more
challenging”, Do Pham Ngoc Tu
said.
Source: Global Times

5
A
s the 2022/23 cotton
season gets underway,
the International Cotton
Advisory Committee (ICAC) says
the market is looking at a very
uncertain future over the next few
months.
The first issue for the cotton
season ahead is the collapse of
the crop in West Texas, which
produces the majority of cotton
for the United States, the world’s
largest exporter, ICAC explains in
its latest update.
Drought has prompted
farmers to abandon virtually all
non-irrigated cotton and now
they’re beginning to walk away
from the irrigated crop too, it
says. It’s possible the deficit could
be mitigated by good crops in
the world’s other top-producing
countries but there’s no guarantee
that will happen, the organization
notes.
In addition, making the
situationevenmore“explosive”,are
what ICAC calls jittery speculators
and investment firms — worried
about a global recession — driving
prices down. This is an especially
dangerous development because
we don’t need to go into a global
recession to cause problems; fear
that we might go into a recession is
sufficient to wreak havoc in cotton
markets, the organization notes.
“Buckle yourself in because
2022/23 looks like it’s going to be
a bumpy ride”, it adds.
The Secretariat is temporarily
suspending publication of the price
projections, with the ICAC noting it
will re-evaluate the price situation
in September and determine if
it should resume price forecast
projection modelling.
“High volatility and
extenuating circumstances in
global markets make it difficult
for any modelling framework
to produce accurate and useful
information,” it says. “Please note
that this is only a temporary pause
and as soon as we are confident
in the model data, we will release
projections.”
From a historical perspective,
the only other time the price model
was suspended was during the
2010/11 season of unprecedented
high price and volatility.
Source: Just style
“Buckle yourself in because 2022/23 looks like it’s going to be a bumpy ride”.
Bumpy road ahead for 2022/23 cotton season

6
C
otton remains an important
export crop for Sub-Saharan
Africa, and currently
accounts for 16% of global
exports.
According to Organization
for Economic Co-operation
and Development (OECD)
and the Food and Agriculture
Organization’s (FAO), the overall
cotton production in the region
has increased in the past years,
because of both increased area
and improved yields.
This is contained in FAO’s
market developments and mid-
term projections for world cotton
markets for the period 2022 to
2031.
“In the current season, higher
prices have led to a significant
increase in area, which fully
recovered from the drop in
2020. However, spinning mill
consumption remains limited
throughout Sub-Saharan Africa,
as many countries export most
of their produce,” the projection
noted.
“Sub-Saharan African exports
are projected to continue growing
at around 1.7% p.a. (per annum)
in the coming decade, with the
region’s market share increasing
by more than 1% point to nearly
18% compared to the base period,
with South and Southeast Asia the
major export destinations.
“However, the textile and
apparel industry are growing in
some other countries, especially
Ethiopia, where efforts are being
made to enhance the processing
capacities across the region. The
expansion has been driven by
favorable economic conditions,
resulting in significant FDI in the
sector. In the long run, this could
imply an increase in mill use and
affect the net export status of Sub-
Saharan Africa.
FAO added economic growth
and urbanization will continue
to be the main factors affecting
the per capita demand for
cotton textiles in developing
and emerging economies. Since
the consumption of textiles and
apparel is more income responsive
than the consumption of food
commodities, deviations from the
economic conditions assumed for
the developing world could lead
to important changes in global
Africa’s cotton exports account for 16% global exports
Cotton harvesting in Burkina Faso. Photo: CIFOR
International cotton prices are expected to remain elevated
in 2022 supported by rising consumption and overall higher
commodity prices but then to decrease in real terms throughout
the outlook period. Global cotton demand remains under pressure
from synthetic fibers, notably polyester.

7
cotton consumption, production,
and trade projections.
“In the short term, projections
will likely be affected by rising
energy prices coupled with the
impact of Russia ‘s war against
Ukraine, which may slow the
global economic growth. In
addition, the emergence of new
Covid-19 variants and subsequent
movement restrictions may
further hamper overall economic
recovery.”
It added: “Moreover, rising
energy prices and supply chain
disruptions have resulted in higher
inflation. The extent to which
interest rates will be raised to
contain inflation could also alter
the cost of borrowing and hence
investment plans in the sector.
Other demand trends could affect
the projections. For example,
recycling by the textile industry is
creating a competitive secondary
market that provides raw material
to producers of lower-quality
textiles and non-textile products.
“This trend could further
reduce the demand for cotton and
other fibers. On the other hand,
greater adoption of sustainability
standards in supply chains could
provide additional stimulus to the
demandforcotton.Likeothercrops,
cotton production is sensitive to
pests and weather conditions.
These projections are therefore
sensitive to climate change, which
could lead to increasing frequency
of droughts and other adverse
weather conditions”.
Source: Farmers Review Africa
C
hina’sPFYexportsamounted
to 1,628kt in Jan-June, 2022,
down 0.3% on the year,
which were at 781kt in Q1, down
13.5% on annual basis, and at
847kt in Q2, up by 16.1% year on
year. Exports surged in May and
June.
As for the second half of year,
PFY export is likely to apparently
increase in Q3 and Q4 of 2022. The
total PFY exports are estimated to
be at 3.15 million tons, a year-on-
year rise of 5.1%.
China’s PFY exports to Asia
witnessed a fall. The proportion
of Asia decreased to 59.4% from
62.4%, that of Europe and Africa
inched down, and that of South
America rose the most (especially
Brazil), up to 12.1% from 9.4%,
followed by North America.
Exports of DTY outshined in the
first half of 2022, with proportion
up to around 50%, while those of
POY and FDY witnessed negative
growth. Export of POY decreased
by nearly 30% year on year. It was
cheaper to directly purchase DTY
instead of buying POY this year.
In addition, export increase
mainly came from some garment
processing nations (like Pakistan),
while these regions are not
integrated with DTY capacity,
which further intensified the
divergence of exported varieties.
China’s PFY export may grow in H2 2022

8
Exports to India collapsed
this year after skyrocketing in
2021, with export volume to India
down by more than 100kt in H1
2022. Soaring exports to Pakistan
and Brazil failed to make up the
losses in India, which was one
of the major reasons for diving
proportion of Asia.
One thing should be noted:
Brazil market may have pulled
forward some demand in the
second half of 2022. It was heard
that Brazil will levy anti-dumping
duty on DTY from China, and
cargos that reach Brazil before
end-Aug will be waived the
ADD, while the specific duty rate
still needs further confirmation.
Pakistani rupee has plummeted,
greatly impacting its import and
export.
Source: Textile Excellence
R
ecord low production
twinned with a sharp surge
in domestic demand may
see India turn into a net cotton
importer in FY23 from being one
of the largest exporters. “This
is the first year when cotton
production fell by 20% and cotton
consumption increased by 30%.
The major cause of the decrease in
production was weather and pests.
Last year the carry-over stock was
lower in comparison to the last
five-year average”, said Manish
Daga, managing director of Cotton
Guru, which helps farmers in the
production process.
The projection of production
this year has come down to 31.5
million bales while consumption is
of 34.5 million bales. It is expected
that India may have to import
nearly 1.5 million bales this year,
he said.
Big cotton exporter India likely to turn into
net importer soon
This is the first year when cotton production fell by
20% and cotton consumption increased by 30%. The
major cause of the decrease in production was weather
and pests. Last year the carry-over stock was lower in
comparison to the last five-year average.
Mr. Manish Daga,
Managing Director of Cotton Guru

9
He said that India used to have
5 to 6 million bales in surplus but
that the surplus has been falling.
Indian industry had a 10% price
advantage as far as cotton was
concerned, which is no longer
there because consumption would
outstrip production and in the
“very near future”, Singh added.
The ministry of commerce
and industry in its response said,
“As per COCPC meeting dated
1 July, current cotton season
2021-22 commenced with an
estimated carry over stock of
71.84 lakh (7.1mn) bales. Thus,
with estimated production of
315.43 lakh (31.5mn) bales, the
total availability of cotton without
considering imports is, 387.27
lakh (38.7mn) bales as against
estimated consumption of 321
lakh (32mn) bales”.
“As already informed, India
is a net cotton surplus country
wherein availability of cotton is
more than consumption. Besides
this, Government of India is taking
various measures to increase
the current productivity and
quality of cotton in the country.
Realizing the need for achieving
a special place for Indian cotton
in the international arena and
to ensure production of assured
quality bales, brand name for
Indian cotton has been launched
as “KASTURI COTTON INDIA” to
attain the objective of making India
Atmanirbhar and vocal for local in
the field of cotton”, the ministry
said.
The ministry of commerce
and industry spokesperson said
that a Textile Advisory Group
(TAG) has been constituted as
an informal body to deliberate
and recommend on the issues
pertaining to the entire cotton
value chain and added, “With all
these interventions, I am sure that
in the years to come, India shall be
the largest player to fulfil all raw
material requirement of the world
textile supply chain”.
A spokesperson for textiles
ministry asked Mint to refer to the
response provided by the ministry
of commerce and industry.
Cotton production has
stagnated because of a lack of
new seeds and modern irrigation
facilities, and frequent pest attacks
and diseases. Demand spiked
as domestic and international
markets began opening up
following the covid-19 pandemic.
Source: Mint
The commerce and industry
ministry in response to Mint’s
queries said that “surplus
availability of cotton in the country
is expected to be 39.37 lakh bales,
based on estimated import of 15
lakh bales and export at 42 lakh
bales. Thus, there seem to be
adequate availability of cotton in
India”.
“During last five years
90% cotton used by Industry is
domestically produced and only
about 5% to 10% of cotton has
been imported from Egypt, Sudan,
USA and other origins, largely of
varieties not produced/produced
less in India such as Extra Long
Staple Cotton and contamination
free cotton. Besides this some
imports were due to competitive
prices”, the ministry said.
“India has been the largest
producer and exporter of cotton for
quite some time now. But of late,
chances are that we will become
a net importer of cotton from
being a net exporter. The reason
is that while cotton production and
productivity have not increased,
cotton consumption is rising”,
textiles secretary UP Singh said in
a press conference on Sunday.

10
After reaching “peak cotton”, a declining role for China
R
ising costs and increasing
competition will, in coming
years, reduce the dominance
that China has enjoyed in the
cotton industry since joining the
WTO in 2001, said an Agriculture
Department report. China is the
world’s largest cotton grower,
importer and consumer at
present, but other Asian countries
are growing in importance as
importers.
At the end of this decade,
Vietnam, Bangladesh, Indonesia,
Turkey and Pakistan would
account for a combined 47% of
world cotton imports, according
to USDA’s long-term baseline.
China’s share would be 24%,
about the same as in recent years.
“Nevertheless, barring
unforeseen policy changes, China
should — for the foreseeable
future — remain a major market
for U.S. cotton exports,” said the
Economic Research Service report.
“China’s role as a cotton importer
appears to have peaked, while
other countries are increasing their
share of imports.”
Imports crested at 24.5 million
bales in 2011, fell to 5 million
bales in 2015 and are projected
by USDA for 10 million bales in
the trade year that
began on August 1.
“ C h i n a ’ s
cotton production,
consumption and
imports peaked
between 2005
and 2013,” wrote
ERS economists
Fred Gale and Eric
Davis. Beijing uses
a tariff-rate quota
(TRQ) to restrict imports, as a step
to avoid reliance on foreign-grown
cotton, and it depends heavily on
production in the Xinjiang region,
more than 2,000 miles from
textile manufacturers in coastal
and central China. Some Chinese
officials envision cotton production
and consumption holding steady
in the near term.
“The lack of growth in the
textile industry may not only be
due to limits on imports but also to
the changing economics of China’s
cotton-textile-clothing industry
chain,” said Gale and Davis. “Use
of cotton has been constrained by
factors such as rising production
costs in many parts of China and
the growing use of synthetic fibers.
The trend also reflects strategic
plans espoused by Chinese
planners, including ‘high-quality
opening’ and ‘One Belt One Road’
strategies, which are responses
to the changing economics of the
industry.”
Chinashiftedcottonproduction
to Xinjiang as growers abandoned
the labor-intensive crop in eastern
and central China in favor of more
profitable crops or higher-paying
jobs in factories. About 12 million
Uyghurs, an ethnic minority, live
in Xinjiang. Human rights groups
accuse China of abuses that
include unfairly detaining more
than a million Uyghurs. Complaints
include conscripting Uyghurs to
harvest cotton.
“China’s use of forced labor in
Xinjiang attracted more attention
to the textile industry,” said the
ERS report. During 2020-21, the
United States barred imports of
cotton and cotton products from
entities in Xinjiang using forced
labor, and in January, the Uyghur
Forced Labor Prevention Act
instituted a broader ban on cotton
grown in Xinjiang and on products
made with the cotton.
One of the world’s largest
producers, the United States is the
number-one cotton exporter, with
shipments forecast for 14 million
bales during the new trade year.
The exports would amount to
90% of this year’s crop.
Source: Successful farming
At the end of this decade, Vietnam,
Bangladesh, Indonesia, Turkey and Pakistan
would account for a combined 47% of world
cotton imports, according to USDA’s long-
term baseline. China’s share would be 24%,
about the same as in recent years.

11
I
n India, the top-producing
country, heavy rains and pests
have cut into cotton crops so
much that the nation is importing
supplies. A heat wave in China
is raising concerns about the
upcoming harvest there.
In the US, the largest exporter
of the commodity, a worsening
drought is ravaging farms and is set
to drag production to the lowest
level in more than a decade. And
now Brazil, the second-largest
exporter, is battling extreme heat
and drought that have already cut
yields by nearly 30%.
This confluence of extreme
weather events brought on by
climate change has sent cotton
prices soaring by as much as 30%.
Earlier this year, they touched
the highest level since 2011,
squeezing the margins of clothing
suppliers around the world and
threatening to raise the costs
of everything from t-shirts, to
diapers, to paper and cardboard.
In a call with investors earlier this
week, Children’s Place CEO Jane
Elfers described the surge in cotton
prices as “a huge, huge problem
for us” and said the company was
hoping to see some relief in the
second half of the year.
The outlook for Brazil is
anything but helpful. The drought
there has already dried up an
estimated 200,000 metric tons
of supply, according to Abrapa, a
group representing growers. With
the nation’s 2021-2022 harvest
close to complete, production is
now seen at 2.6 million tons -- or
less.
Extreme weather is wreaking havoc upon virtually all of the world’s
largest cotton suppliers.
A farmer manually picks cotton in a field in Sirsa, Haryana, India.
Photo: Prashanth Vishwanathan/Bloomberg
The world’s cotton supply keeps shrinking, hit by
DROUGHT and HEAT

12
Bom Futuro group, one of
Brazil’s largest cotton producers
accounting for about 10% of the
nation’s planted area, has seen
yields fall 27% compared with
the previous season. Julio Cezar
Busato, a grower in Sao Desiderio,
Bahia state, has suffered from
a similar decline. Dryness is
reducing the number of cotton
bolls, making them lighter across
all of the country’s main growing
regions, he said.
Meanwhile, US output is set
to plunge 28% in the season that
began this month. The US expects
production to hit the lowest level
since the 2009-2010 season,
sending stockpiles to near-historic
lows, because of a drought that
has become so extreme that the
US government is rationing water
from the Colorado River. Together,
the US and Brazil account for half
of the world’s cotton exports.
The decline in global
supplies has become so steep
that it’s overshadowing demand
headwinds. The US government
and analysts have been projecting
a drop in demand due to a slide in
clothing purchases and slowing
economies, especially in Europe
and Asia. And yet all signs point
to “much higher” cotton prices
in the coming months with
crops shrinking, said Andy Ryan,
senior relationship manager for
Hedgepoint Global Markets in
Nashville.
Source: Bloomberg

13
Với khả năng truy
xuất và xác minh dữ
liệu hiện đại nhất,
U.S. Cotton Trust
Protocol® là một
công cụ hữu hiệu giúp
đảm bảo tính bền
vững cho chuỗi cung
ứng của quý vị. Tất
cả chương trình đều
miễn phí cho thành
viên của U.S. Cotton
Trust Protocol® và
COTTON USA™.
Nông nghiệp tái sinh
được xây dựng dựa
trên các tác động tích
cực đến môi trường
của các thực hành
bền vững, hướng tới
một cách tiếp cận
toàn hệ thống đối với
các thực hành bền
vững tích cực.
Nghiên cứu được thực
hiện bởi US Cotton
Trust Protocol, một
sáng kiến dựa trên cơ
sở khoa học, cấp trang
trại đang thiết lập
một tiêu chuẩn mới về
bông phát triển bền
vững hơn, cho thấy
rằng 61% các thương
hiệu và nhà bán lẻ đã
chứng kiến nhu cầu
về các sản phẩm bền
vững từ người tiêu
dùng ngày càng tăng.
Ngày nay, hơn bao
giờ hết, người tiêu
dùng trên toàn cầu
muốn biết rằng quần
áo trong tủ quần áo
của họ có nguồn gốc
bền vững.

14
Bản tin tháng 8-2022
VCOSA’S EVENT
SUMMIT HIGHLIGHT:

Ô Policy Analysis for Vietnam Textile and Apparel Industry and Outlook for 2040

Ô Value Chain Impacts for Textiles Consumption in the EU and Related Policies

Ô Trade & Tax: The Trend of Vietnam Textile and Apparel Industry Under the Impact of USA
& China

Ô Road to Recovery: Post Pandemic Business Outlook in Vietnam

Ô Challenges and Opportunities for Global Supply Chain and How It’s Going to Affect
Vietnam Textile and Apparel Industry

Ô Under the Background of Industrial 4.0, Will Digital Transformation Help Vietnam Recover
from Covid - 19 and Grow Faster

Ô Integrating Value Chain Approaches to Determining BAT (Best Available Techniques) for
Industrial Installations

Ô Speed to Market: How to Do it More with Less and Do it Faster

Ô Panel Discussion: Under the New Global Trade Environment, How Will Manufactures and
Brands Work Together to Build a More Resilience Supply Chain

Ô Big Data Analytics for Manufacturing

Ô Post Covid Sourcing Strategy: What Should We Prepare for Sourcing in Vietnam and SEA

Ô Development of Eco-friendly Materials and Techno-logies to Adapt to Global Sustainable
Fashion Trends

Ô Rethinking Business Models for the Fashion Industry: Environmental and Value Chain

Ô Plastic Waste is Growing: Economic Drivers, Environmental Impacts and Policy Options

Ô Case Study: Carbon Footprint Assessment for Vietnam Textile and Apparel Industry

Ô Population and Labor Force: How Vietnam Manu-factures Strengthen Their Competition

Ô Sustainable Chemistry in Textile Processing — the Need of Hour in Vietnam

Ô Panel Discussion: Past and Future - What’s the differ-ence Between Vietnam and Other
Asian Countries
The 8th
Vietnam Textile Summit

16

17
WHO WE ARE?

™ The Vietnam Cotton and Spinning Association (VCOSA) is a non-governmental organization, established
and operating under Decision No. 1225/QD-BNV dated October 27, 2010 of the Vietnam Ministry of
Home Affairs on the basis of merging the Vietnam Cotton Association and Vietnam Spinning Association.

™ VCOSA is the legal representative for the member enterprises, spinning and affiliated industry. VCOSA’s
mission is to promote the development of the spinning industry, contributing to the overall development
of the textile and garment industry in Vietnam.
HOW WE DO?
What benefits user get from VYP? Where is the price data source?

™ Yarn prices are shared and contributed by users in Vietnam and other countries.

™ Prices are referenced from international market.

™ Prices are referenced from domestic market of China, India, Pakistan, Bangladesh.
WHAT WE DO?

™ VietnamYarnPrice, abbreviated as VYP, is one of products of VCOSA. VYP is built and developed according
to the needs of members. VYP is operated and developed by members and enterprises (called users) by
the information that users contribute every day.

™ What kind of information that you can get from VYP?
1. Fiber prices: cotton fiber, polyester fiber, semi-finished products from PE, visco fiber.
2. Yarn prices: CD, CM, OE, TC, CVC, PE, Rayon, PC, Pe-Rayon... Multi yarn count.
3. Yarn prices for weaving or knitting.
4. Prices of fibers and yarns of various types and specifications contributed by users from Vietnam.
5. Prices of fibers and yarns of various types and specifications contributed by users from abroad.
6. Historical data from 3-10 years.
7. Range of volatile price in 1 day, 1 week and 1 month for fibers and yarns.
8. Chart of price movements over each period.
9. Document download in EXCEL/PDF.

18
REPORT AND DATABASE
In July 2022, Vietnam’s cotton imports reached
104.9 thousand tons, worth 310.6 million USD, up
12.2% in volume and 14.4% in value compared to the
previous month, down 25.3% in volume but up 13%
in value compared to July 2021.
Fiber & yarn imported to Vietnam was 91.3
thousand tons, worth USD 237.4 million, down 3.2%
in volume compared to the previous month; up 0.3%
in volume and 2% in value compared to July 2021.
According to preliminary data in July 2022, Vietnam imported 104.9 thousand tons of cotton, up 12.2%
compared to the previous month. Imported of fiber and yarn was 91.3 thousand tons, unchanged from the
previous month.
1. Monthly Import Statistics

19
According to preliminary data in July 2022, imported of fiber and yarn was about 91.3 thousand tons,
unchanged from the previous month, up 0.3% over the same period last year.

20
According to preliminary data in July 2022, Vietnam imported 104.9 thousand tons of cotton, up 12.2%
over the previous month, but down 25.3% over the same period last year.
In the first 7 months of 2022, Vietnam imported
cotton worth 2.14 billion USD, up 15.1% over the
same period last year; import of fiber and yarn valued
at 1.64 billion USD, up 5.8%; fabric import was
9.11 billion USD, up 7%; import of raw materials
for textiles, garments and footwear increased by
5% over the same period last year, valued at 4.07
billion USD.

21
According to statistics of the General Department of Customs, cotton imports to Vietnam in June 2022
reached 93.47 thousand tons, worth USD 271.55 million, down 22.4% in volume and 19.6% down in
value compared to May 2022; down 35.8% in volume and 4.5% in value compared to June 2021.
In the first 6 months of 2022, there are 10 markets
supplying raw cotton to Vietnam, stable compared to
the same period in 2021. In which, Vietnam’s import
of raw cotton from some main markets decreased
sharply compared to the same period in 2021as the
US, Brazil, India... Specifically:
Cotton imports from the US market reached the
largest level in the first 6 months of 2022, reaching
247 thousand tons, worth 716 million USD, down
35.6% in volume but up 0.2% in value over the same
period last year, accounting for 36.3% of total cotton
imports. Particularly in June, 2022, cotton imports
from this market reached 53.68 thousand tons, worth
US$158 million, down 30.2% in volume but up 1.8%
in value compared to June 2021.
The second is the Brazilian market: cotton imports
from the Brazilian market decreased by 25.6% in
volume but increased by 11% in value compared to
the first 6 months of 2021, reaching 181 thousand
tons, worth 484 million USD. Particularly in June
2022, cotton imports from this market reached 16.07
thousand tons, worth 45.63 million USD, down
50.5% in volume and 27% in value compared to June
2021.
In addition, cotton imports from some other
markets increased sharply in the first 6 months of
2022 compared to the same period in 2021 such as:
from Australia by 56.8%; from Argentina increased to
416.8% in volume.
1.1. The price of imported cotton is forecast to decrease
Source: VITIC

— 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

22
About price: The price of cotton imported into
Vietnam in June 2022 was at USD 2,905/ton, up 3.6%
compared to May 2022 and up 48.6% compared to
June 2021.
Generally, in the first 6 months of 2022, the price
of cotton imported to Vietnam averaged 2,690 USD/
ton, up 49.4% over the same period in 2021.
The average price of imported cotton from
markets in the first six months of 2022 mostly
increased compared to the same period in 2021, in
which, the price of imported cotton from the main
markets increased sharply in the range of 33-60%.
The lowest price of cotton material imported from
Indonesia reached 1,321 USD/ton; followed by from
India at 1,782 USD/ton and the highest import price
from Australia was at 3,045 USD/ton.
Import prices of cotton materials in Vietnam are
still increasing, in contrast to the situation of world
cotton prices are falling sharply. Specifically: The price
of ICE cotton has dropped sharply and the October
2022 ICE contract was traded at 99.89 US cents/lb.
on July 12, 2022, equivalent to Rs 176/kg.
According to the assessment, the difference
between world cotton prices and Vietnam’s imported
cotton prices will continue in the coming months. The
reason is that market sentiment has been under a lot
of pressure due to falling world cotton prices, besides,
spinning and weaving mills are also more cautious
with the expectation that prices will fall further.
The sharp drop in world raw cotton prices will also
affect Vietnam’s raw cotton market. It is forecasted
that the price of Vietnam’s imported cotton will
decrease in the near future.
Source: VITIC
Vietnam’s import cottons in June 2022
Source: VITIC

23
According to statistics of the General Department
of Customs, Vietnam’s imported fiber in June
2022 reached 31.3 thousand tons, worth 45.79
million USD, down 7.2% in volume and down 1.9%
in value compared to May 2022, up 1.8% in volume
and 8.9% in value compared to June 2021. Generally,
in the first 6 months of 2022, the import of raw fiber
reached 190 thousand tons, worth 264 million USD,
down 12% in volume and 3.3% in value over the
same period in 2021.
Source: VITIC
Source: VITIC
Import price of cotton June 2022
1.2. It is forecasted that the import price of fiber will decrease

24
In June 2022, Vietnam
imported raw fiber from 27
markets, an increase of 4 markets
compared to the same period in
2021, in which, China is the largest
supplier of fiber to Vietnam, with
imports reached 15.68 thousand
tons, worth $21.71 million, up
10.9% in volume and 24.3% in
value compared to May 2022,
up 7.7% in volume and 22 .8%
Generally, in the first 6 months
of 2022, imports of raw fibers
from China market into Vietnam
reached 84.41 thousand tons,
worth 109.05 million USD,
accounting for 44.4% of total
imports, down 9.5% in volume but
up 2.1% in value compared to the
first 6 months of 2021.
The second is the Taiwan
market, with the amount of
fiber imported from this market
reaching 4.56 thousand tons,
worth 6.34 million USD, down
22.8% in volume and 22.6% in
value compared to May 2022,
down 1.2% but increasing 24.3%
of 2022, imports of raw fiber
from Taiwan market into Vietnam
reached 28.5 thousand tons, worth
38.56 million USD, accounting for
15% of Vietnam’s total import of
raw fiber, down 18.5% in volume
but up 0.2% in value compared to
the first 6 months of 2021.
In general, in the first 6 months
of 2022, imports of raw fibers
from the main supplying markets
to Vietnam decreased slightly
compared to the same period in
2021, except for imports from
the Indonesian market, which
increased by 6.2% in volume.
Notably, the amount of
imported fiber from some
markets increased sharply in the
first 6 months of 2022 such as
Bangladesh.
Vietnam’s import fiber in June 2022
Source: VITIC

25
About price: In June 2022, the
price of imported fiber to Vietnam
averaged $1,463/ton, up 5.7%
compared to May 2022 and 6.9%
higher than June 2021. In which,
the price of raw fiber imported
from the Indian market reached
the lowest level of 1,131 USD/ton;
followed by from Thailand reached
1,314 USD/ton and the price of
imported fiber from Singapore
market reached the highest level
at 4,350 USD/ton.
of 2022, the price of imported fiber
into Vietnam averaged $1,391/
ton, up 9.4% over the same period
in 2021.
World cotton prices are under
downward pressure due to weak
demand, while cotton supply is
forecast to decrease in India - the
world’s largest cotton producer,
production will decrease due to
weather and pests, and India will
become a net importer of cotton
this year. According to sources,
cotton prices in India have fallen
from a peak of Rs 103,000/candy
in May 2022 to Rs 86,400/candy in
July 2022.
Under pressure to reduce
world cotton prices, it is forecasted
that the price of imported fiber
into Vietnam will also decrease
in the coming time. It is estimated
that the average price of raw fiber
imported into Vietnam in July 2022
will reach 1,400 USD/ton.
Import price of fiber in June 2022
Source: VITIC
Source: VITIC

26
According to the statistics of
the General Department of
Customs, the import of raw yarn in
June 2022 reached 60.82 thousand
tons, worth 199.17 million USD,
down 9.3% in volume and down
3.9% in value compared to May
2022, down 11.2% in volume
but up 24% in value compared to
June 2021. In the first 6 months of
2022, the import of raw yarn into
Vietnam reached 370 thousand
tons, worth 1.14 billion USD,
down 6.1% in volume but up 9.6%
in value over the same period last
year 2021.
China is the largest source of
raw yarn for Vietnam in June 2022,
with the import volume reaching
43.31 thousand tons, valued at
USD 136.37 million, up 7.3%
in volume and up 6.4% in value
compared to May 2022; up 24.1%
in volume and 48.3% in value
compared to June 2021. Generally,
in the first 6 months of 2022,
imports of raw yarns from China
market into Vietnam reached
234.27 thousand tons, worth
US$686.11 million, accounting
for 63.3% of total imports, down
0.3 % in volume but increased by
22.1% in value compared to the
first 6 months of 2021.
In June 2022, the import of
raw yarn from Taiwan market
reached 8.75 thousand tons, worth
23.92 million USD, down 10.4%
compared to May 2022; up 12.3%
and 16.1% in value compared to
June 2021. Generally, in the first 6
months of 2022, the import of raw
yarn from Taiwan market reached
52.14 thousand tons, worth USD
143.88 million, accounting for
14.1% of Vietnam’s total import
of raw yarn, a decrease 11.3%
compared to the first 6 months of
2021.
In general, in the first 6 months
of 2022, imports of raw yarn from
mainsupplyingmarketstoVietnam
decreased, except for imports from
Thailand, which increased sharply
by 37% in volume.
Notably, the import volume
of raw yarn from some markets
increased sharply in the first 6
months of 2022 such as Brazil,
Australia, and Sri Lanka.
1.3. The price of imported yarn is forecast to decrease
Source: VITIC
Vietnam’s import yarn in June 2022

27
In terms of price: Import price
of raw yarn in June 2022 was at
$3,275/ton, up $183/ton compared
to May 2022 and up $335/ton
compared to June 2021. Generally,
in the first 6 months of 2022,
the price of imported raw yarn to
Vietnam reached an average of
3,094 USD/ton, up 17.3% over the
In which, the lowest price of
raw yarn imported from Malaysia
reached 1,770 USD/ton; followed
by from Taiwan market reached
USD 2,732/ton and the highest
import price from Hong Kong
market was USD 15,651/ton.
World cotton yarn prices have
turned down in recent months, but
Vietnam’s raw yarn import prices
are still high. With the signal of
a decrease in world cotton yarn
prices, it is forecasted that the price
of Vietnam’s imported yarn will
decrease in the coming months
and the amount of imports will
increase to serve the production
and export of textile enterprises
in the coming months end of the
year.
Source: VITIC
Source: VITIC
Source: VITIC
Import price of yarn in June 2022

28
In July 2022, Vietnam exported 110.1 thousand tons of fiber and yarn, worth 322.5 million USD, down
16.1% in volume and down 20% in value compared to the previous month; down 17.1% in volume and 2.1%
in value compared to July 2021.
Fiber and yarn exports in July 2022 were valued at 322.5 million USD, down 20% from the previous
month; fabric exports reached 234.3 million USD, down 5.7%; materials for textiles, leather and footwear
reached 191 million USD, down 4.3%; technical textile exports increased by 0.1%, worth 77 million USD.
2. Monthly Export Statistics

29
Vietnam’s fiber and yarn exports in July 2022 reached 110.1 thousand tons, worth 322.5 million USD,
down 16.1% in volume and 20% in value compared to the previous month.
Textile and apparel exports in July 2022 reached 3.68 billion USD, up 2.7% over the previous month.

30
According to preliminary data in July 2022, textile and apparel exports reached 3.68 billion USD, up 2.7%
MoM, up 18.1% YoY.
In the first seven months of 2022, Vietnam’s fiber and yarn exports were worth 3.1 billion USD, down
2.1% over the same period last year; fabric exports reached 1.67 billion USD, up 20%; raw materials for
textile, garment, leather and footwear reached 1.37 billion USD, up 18.1%; technical textile exports increased
by 22.7%, valued at 530.6 million USD.

31
According to statistics from the General
Department of Customs, Vietnam’s exports of
textile fibers and yarns in June 2022 reached 131.16
thousand tons, with a turnover of 402.8 million USD,
down 3.9% in volume and down 8 .2% in turnover
compared to May 2022, down 23.6% in volume and
17.6% in turnover compared to June 2021. In general,
in the first 6 months of 2022, Vietnam’s exports of
textile fibers and yarns reached 854.1 thousand tons,
with a turnover of 2.77 billion USD, down 13.5% in
volume, but up 4.9% in value compared to the same
period in 2021.
In terms of prices: The export price of Vietnam’s
fiber and yarn products continued to decline in
June 2022, reaching 3,071.4 USD/ton, down 4.6%
compared to May 2022, but still up 7.9% compared
to June 2021. Thus, compared with the price at the
beginning of the year, the export price of Vietnam’s
textile fiber and yarn has decreased by 6.5% so far.
However, in the first 6 months of 2022, the
average export price of Vietnam’s textile fibers and
yarns reached 3,249.7 USD/ton, up 21.3% over the
Currently, fiber prices on the world market are
still falling due to weak demand. In the Indian market,
in the middle of July 2022, the price of cotton yarn
decreased by 10-15 Rupees/kg in Delhi market and
5-10 Rupees/kg in Ludhiana, the price of recycled yarn
also recorded a downward trend in the market. In the
Panipat market, some recycled yarns are quoted at
Rs 3-5/kg lower. Meanwhile, cotton prices remained
stable amid sluggish trading in Northern India.
Following the downward trend of world prices,
Vietnam’s fiber and yarn export prices will also
continue to be under downward pressure in the
coming time.
2.1. Outlook for fiber and yarn exports remains positive
Source: VITIC
Source: VITIC

32
In June 2022, the average export price of
Vietnam’s fiber and yarn to most markets decreased
compared to May 2022, but exports to some markets
still increased such as the US, Thailand, Colombia,
Italy, Sri Lanka.
Generally, in the first 6 months of 2022, the
average export price of Vietnam’s textile fibers and
yarns increased in many markets compared to the
same period in 2021, excluding exports to some
markets with reduced prices such as Bangladesh and
Turkey, Brazil.
Vietnam mainly exports textile fibers and yarns of
all kinds to the Chinese market in the first half of 2022,
accounting for 47.3% of the total export turnover of
this item, exports to the remaining markets account
for 1-10%, depending on the market.
In general, Vietnam’s exports of textile fibers and
yarns to markets grew unevenly in the first 6 months
of 2022 compared to the same period in 2021, of
which, exports to the largest market, China, decreased
by 27% in volume and 8.6% in turnover; exports to
the Korean market decreased by 13.3% in volume but
increased by 6.5% in turnover... In contrast, exports
of textile fibers and yarns to some markets increased
such as Bangladesh, the US, Indonesia, Thailand, and
India.
Export market:
Export price of fiber and yarn in June 2022
Source: VITIC

33
In the context of weak demand from the world
market, along with high input material prices, but
Vietnam’s exports of fiber and textile products still
increase in the first half of 2022. This is the basis for
Vietnam promotes the export of this item in the last
months of 2022.
Some factors that will support Vietnam’s export
of textile fibers and yarns in the coming time are:
- Vietnam is accelerating the process of
international economic integration, especially the
participation in free trade agreements in the near
future such as CPTPP, EVFTA, RCEP... will be the basis
for Vietnam’s fiber and yarn industry breakthrough in
the coming time.
- The two largest textile import regions in the
world, the US and the EU, tend to reduce imports of
textile materials from China while increasing imports
from other countries. Therefore, Vietnam will have
the opportunity to expand its export market share of
fibers, yarns and textiles in the future.
- According to WHO, new variants of Covid-19
will continue to appear in 2022 and the time for Covid
to become endemic is still very uncertain. As a result,
Vietnam’s fiber and yarn segment is expected to
continue to be the key recovery driver and to be less
affected than apparel, as production is mainly done
by machines.
- Another factor that creates opportunities
for Vietnam’s fiber and yarn products to have great
potential in the coming time. That is, synthetic fibers
from petroleum, coal and natural gas now account for
more than 60% of the global fiber market. Therefore,
the Russia-Ukraine conflict has a direct impact and is
expected to increase the cost of fiber production by
2022.
- The 4.0 technology revolution is taking place
strongly, which is affecting and changing as well as
opening up many opportunities for the manufacturing
industry, including the development of the spinning
industry.
Accordingly, the old advantages in the spinning
industry such as low-cost labor, traditional materials...
will no longer exist, and a series of new products
will be successfully researched and manufactured
(especially recycled yarn products).
Outlook for Vietnam’s textile and fiber exports in the coming time
Vietnam’s export fiber and yarn in June 2022
Source: VITIC

34
C
otton prices continue to be
caught between the two
competing storylines that
have been in play for the past
several months.
On one side, there is
the deteriorating global
macroeconomic situation. The
International Monetary Fund
(IMF) lowered its projection for
global economic growth in both
2022 (3.2%) and 2023 (2.9%)
in the updates released in late
July. Current IMF forecasts are
significantly beneath those from
January (called for 4.4% growth in
2022 and 3.8% growth in 2023)
and April (called for 3.6% growth
in 2022 and 3.6% growth in 2023).
Theevolutioninthemacroeconomy
was a likely factor contributing to
the shift in investors’ outlook on
the commodity sector, which led
to a collapse in prices for cotton
and a range of other commodities
in June and July.
Beyond the weakening
macroeconomic environment,
there also may be factors
associated with cotton supply
chains that could affect demand
during the 2022/23 crop year.
Downstream consumer markets
for cotton can be viewed as more
discretionary than other spending
categories, such as food, energy,
and lodging, that experienced
some of the sharpest effects of
inflation. Given price increases for
necessities, consumers may have
less income to devote to apparel
and home furnishings.
In the U.S., consumer spending
on clothing has been flat for the
past year. However, it has been
holding at levels that are 25%
higher than they were in 2019.
If U.S. consumers pull back on
clothing purchases, it may hit
the market just as retailers have
caught up with consumer demand
after the onset of the shipping
crisis. In weight volume, the cotton
contained in U.S. apparel imports
West Texas has had very little rain over the past year, and drought conditions
have been extreme. As a result, abandonment is forecast to be widespread. It
remains to be seen exactly how small the U.S. crop will be, but the current USDA
forecast predicts only 12.6 million bales in 2022/23
3. Cotton Outlook Aug-2022

35
was up 22% year-over-year in the
first half of 2022. Relative to 2019
(pre-COVID and pre-shipping
crisis), the volume in the first half
of 2022 was up 23%. Given strong
import volumes, if there is a dip in
consumer demand, inventory could
build both at retail and upstream
in supply chains. This could lead
to cancelations, potentially all
the way back to the fiber level,
where contracts signed at prices
higher than current values could
be particularly susceptible.
TightU.S.supplyisontheother
side of price direction arguments.
Cotton is drought tolerant, and that
is why it can be viably grown in
perennially dry locations like West
Texas. However, cotton requires
some moisture to germinate and
generate healthy yields. West
Texas has had very little rain
over the past year, and drought
conditions have been extreme. As
a result, abandonment is forecast
to be widespread. It remains to be
seen exactly how small the U.S.
crop will be, but the current USDA
forecast predicts only 12.6 million
bales in 2022/23 (-5.0 million
fewer bales than in 2021/22).
Meanwhile, demand for
U.S. cotton has been relatively
consistent, near 18 million bales
over the past five crop years (an
average of 15.5 million bales of
exports and 2.7 million bales of
domestic mill-use). A harvest of
only 12.6 million falls well short
of the recent average for exports
alone, and U.S. stocks were near
multi-decade lows coming into
2022/23. All these statistics
suggest shipments from the
world’s largest exporter may have
to be rationed in 2022/23. If cotton
is not readily available from other
sources, the scarcity of supply
from the U.S. could support prices
globally.
Simultaneously, there is
weakness from the demand
side. The market has struggled
to find the balance between the
weakened demand environment
and limited exportable supply
in recent months. The conflict
between these two influences
makes it difficult to discern a clear
direction for prices and suggests
continued volatility.
Source: CI_VCOSA collected

Head Office
15/Fl., Block B, Viettel Complex Tower, 285 Cach Mang Thang Tam str., ward 12, dist. 10,
Ho Chi Minh city
Representative Office
Room 403, 4/Fl., Ocean Park Tower, 01 Dao Duy Anh str., Phuong Mai ward, Dong Da dist.,
Ha Noi city
Office (mailing address)
1265 Hoang Sa str., Ward 5, Tan Binh Dist., Ho Chi Minh city

œ +84 902 379 490

œ info@vcosa.org.vn

œ www.vcosa.org.vn

VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 08/2022 ISSUE

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 08/2022 ISSUE

Similar to VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 08/2022 ISSUE (20)

More from Vietnam Cotton & Spinning Association

More from Vietnam Cotton & Spinning Association (16)

Recently uploaded

Recently uploaded (20)

VCOSA - VIETNAM COTTON - YARN MARKET REPORT - 08/2022 ISSUE