In the current era of global economic integration, any disturbance in trade policies will cause a thousand waves in various industries, and the cotton industry and cotton textile industry are no exception. The promulgation of this “reciprocal tariff” executive order is bound to have an impact on the entire Chinese textile and garment industry. The cotton market is an important upstream raw material for textiles. Affected by the transmission of the textile industry chain, the cotton industry will inevitably be involved in all links from planting, production, to trade and consumption.
With the progress of the “reciprocal tariff” incident and the feedback from various countries, the turmoil is turning from severe to gentle. Many domestic financial institutions have begun to conduct industry analysis from all levels. The cotton market has the financial attributes of commodities, and many futures institutions have continuously released research reports. Overall, since China has taken the initiative to reduce its imports of U.S. cotton in recent months, even without U.S. cotton, China can still import Brazilian cotton, Australian cotton, etc. Therefore, this “reciprocal tariff” and China’s countermeasures will not have much impact on my country’s cotton supply; but China is the main export market for U.S. cotton. This time, China’s 34% tariff on U.S. products will further increase the pressure on the U.S. cotton sales market.
As we all know, China is a major cotton producer and consumer, but it still needs to import a certain amount of cotton every year to meet the huge domestic textile industry demand.
China’s annual cotton production is around 6 million tons, and consumption is 7-8 million tons. Therefore, there is a gap of 1-2 million tons of cotton every year, and the gap needs to be supplemented by importing foreign cotton.
202 In 2023, the United States accounted for 45% of China’s cotton imports. Since the second half of 2024, China has taken the initiative to reduce its imports of American cotton. In recent months, my country’s imports of American cotton have declined significantly. Therefore, even without American cotton, China can still import Brazilian cotton, Australian cotton, etc. In this context, China’s 34% tariff on American cotton will not have much impact on my country’s cotton supply.
At the same time, increasing support for domestic cotton production and improving domestic cotton self-sufficiency, such as promoting the development of Xinjiang’s cotton industry and improving cotton quality and output, these early efforts will have a positive effect on the stability of the cotton market this year.
From the perspective of the US market, China is the main export market for American cotton. China accounts for 40% of the contracted export market for American cotton in 2023, but from 202 Since the fourth quarter, the Chinese market has taken the initiative to reduce the proportion of imports of US cotton to 7%, and the export pressure of US cotton has increased. This time, China’s 34% tariff on US products will further increase the pressure on the US cotton sales market, which is bad for US cotton.
It can be foreseen that US cotton will definitely face export obstructions and sales decline in the future. The US cotton export is facing difficulties, and the income of domestic cotton farmers in the United States will also be affected, which will greatly reduce their willingness to plant. The National Cotton Council (NCC) of the United States predicts that the cotton area in the United States will be 9.6 million acres in 2025, a decrease of 14.5% from 2024. After weighing the benefits and costs of planting, cotton farmers have chosen to reduce the cotton planting area and switch to other crops with more economic benefits or lower risks, such as corn and soybeans.
But it must be made clear that the small impact on the supply side does not mean that prices will not fluctuate.
The US tariff policy has caused changes in the supply and demand relationship in the global cotton market, which will in turn lead to fluctuations in cotton prices. When China imposed tariffs on US cotton, US cotton exports were blocked, the global cotton market supply was relatively loose, and prices were under downward pressure. On the other hand, China and other countries are actively exploring other import channels to ensure their own cotton supply, which may cause cotton prices to rise in some regions.
For the domestic cotton market in China, price fluctuations increase the operating risks of enterprises. It is difficult for textile companies to accurately predict the cost of raw materials, and they will definitely become more cautious in production and pricing decisions.
From a longer timeline, the US tariff policy has broken the original global cotton trade pattern, and the trade flow has changed significantly, which will have a profound impact on the global layout of the entire cotton market.
Many products of Huaian Good Life Textile Co., Ltd. are related to cotton, such as cotton poncho towel, cotton bath robe, cotton hotel bath towel, cotton beach towel, etc. We are still paying close attention to policy trends and actively adjusting strategies to adapt to the new market environment and achieve sustainable development.
Post time: Apr-11-2025