FX.co ★ China Holds Cotton Quota Steady Despite Trade Slump

China is set to allocate 200,000 metric tons of sliding tariff rate cotton import quotas to textile firms engaged in the processing trade, a volume consistent with last year's allocation, as announced by the National Development and Reform Commission (NDRC). These quotas will be distributed based on contract applications, up to the specified limit, beyond which no further applications will be considered. The deadline for applications is December 31, although the issuance date for the quotas has not been disclosed. As a leading global cotton importer, China remains a significant player despite its substantial domestic production. In 2022, China imported cotton worth $8.29 billion, primarily from the U.S., Brazil, and Vietnam. This quota initiative follows a substantial 74.2% decrease in cotton imports, which fell to 520,000 metric tons from January to July, driven by decreased demand and more stringent trade conditions. The newly allocated quota is intended to address the cotton requirements of domestic processors and ensure a stable supply for China's extensive textile industry.