Section A: Basic Description about the industry

Present scenario of the industry

Bangladesh may overtake China as the world's biggest cotton importer in the current crop
season thanks to strong demand from apparel makers, according to data from the US
Department of Agriculture.
In the year ending July 31, 2016, Bangladesh may import a record 5.75 million bales of the
fibre, up 6.5 percent from a year earlier, said the USDA last week. One bale weighs 480
pounds, or 218 kilograms. China is projected to import 5.5 million bales, the lowest since
2003, according to Bloomberg.
Bangladesh's share of the global cotton-export market doubled from 1995 to 2012, mostly
because of the strong performance of the garment sector, the World Bank said in an October
report.

Importance of the industry in national economy

Cotton plays a key role our national economy in term of generating direct and indirect
employment in the Agricultural and Industrial sectors. Textile and Garment industries
constitute the largest manufacturing sub-sector in Bangladesh's economy. It employs over 4.5
million people which accounts for 10.5% of the national GDP with 40% of manufacturing
value addition. 75% of total export earning comes from Textile Sector. Bangladesh ranks as
5th largest apparel exporter to USA after China, Vietnam, Mexico and Indonesia. Export
value of Textile Sector is $10.7 billion US$ of which $6.74 billion goes to EU, $2.60 billion
to US and $1.36 billion to rest of the world.
Cotton is the second important cash crops in Bangladesh after Jute. It is the main raw
materials of Textile industry. Annual requirement of raw cotton for textile industry of
Bangladesh is approx. 4 million bales. Around 3% of the national requirement is fulfilled
through the local production (nearly 0.1 million bales) from 40 thousand hectares of land and
remaining 97% requirement is fulfilled by importing raw cotton from Uzbekistan, Pakistan,
India, Brazil, Turkmenistan and from African countries (BCA, 2010). The present yield of
cotton per hectare is lower in comparison to other cotton growing countries. The productivity
of cotton in Bangladesh is only 450 kg lint ha-1 against the world average of 556 kg lint ha-1.

Recent import trend of the industry

Cotton import by year

Cotton import in Bangladesh has been rapidly increasing by each year. From 1991 to 1993
there was a bit fall of import, but from 1994 to 2010 the import rate was dramatically
increased then fell again in 2011. From 2012 to 2016 the growth was exponential. A list of the
percentage and the amount of import are given in the next page.

Amount of import and percentage

Major Import destitanion of the industry

Bangladesh has to import almost all its cotton requirements to feed its spinning industry. In
2010 seasons, Bangladesh reportedly imported 827,000 Metric Tons 170-Kg bales from
different countries of which prominent import sources are Uzbekistan-42 %, India-22 %,
Africa-10 %, U.S.A-11 % and Pakistan7%.

Import Trade Matrix

Source: USDA
2010 cotton imports has reached 3.82 million bales (827,000 tons); an increase of 11.26
percent compared to previous year, due to competitive import prices and increased demand
from the growing spinning sub-sector. Uzbekistan continues to be the principal supplier of
raw cotton, enjoying 42 percent market share due to competitive prices and a short delivery
period. India has also emerged as a major supplier of raw cotton due to its price
competitiveness and geographical proximity. The share of U.S. raw cotton in the Bangladesh
import market has increased to about 11 in MY 2009/10 due to the new generation spinning
mills coming into operation, which prefer the high quality of US cotton. However, U.S.
cotton prices will have to remain competitive to offset the freight advantage and shorter
delivery periods enjoyed by neighboring suppliers.