According to the YnFx Fibre and Yarn Exports-India report for March 2015, despite China being the largest importer of cotton spun yarn from India and Bangladesh, the second-largest, China has been paying much lower rate compared to the latter. For example, during February 2015, India exported 53.3 million kg of all kinds of spun yarns to China and 14.9 million kg to Bangladesh. Of these, 53.2 million kg and 13.2 million kg were cotton yarn, respectively and values were $140 million for China and $41 for Bangladesh. Thus the average unit value realization for exporting cotton yarn to China and Bangladesh works out to $2.64 per kg FOB India and $3.12 per kg FOB India.
The same values in February 2014 was $3.06 a kg and $3.55 per kg, respectively. Thus, the realisations have declined 14 per cent and 12 per cent for the two destinations from February 2014 and 2015. Among the 73 countries to which cotton yarn was exported in February 2015, Jordan paid the least at $2.31 a kg and Japan paid the highest at $6.16 per kg. However, the report points out that the differentiation may be attributed to the size of the volume, quality differentials, deliverability, and other technical aspects. But for China and Bangladesh, these qualifications are assumed to be neutral since the cargo-mix could be the same on an average. In February 2015, China imported cotton yarn at US cents 48 lower than Bangladesh and the same difference in 2014 was US cents 49 a kg. This implies that the difference has remained stagnant between both the markets.
Deciphering counts wise export of cotton yarn, to these two markets, shows the same result accepting in case of few counts. China was the largest importer of 32/1 cotton yarn with volumes at 24 million kg valued at $67.6 million while Bangladesh imported 0.41 million kg worth $1.3 million. Thus, unit value realisation works at $2.81 a kg for China and $3.15 a kg for Bangladesh. The differential between the two was US cents 34. Here, China had the advantage of larger volume over Bangladesh. In the same month, export of 30/1 yarn to Bangladesh stood at 3.15 million kg worth $9.8 million and the same to China was 1.80 million kg worth $5.30 million. Here, the unit value realisation was $3.10 a kg for the former and $2.98 for the latter. Again China was sold 30/1 at a price US cents12 lower than Bangladesh.
In similar comparison, China had advantage of US cents 7 for 40/1, US cents 21 for 20/1, US cents 63 for 24/1 and US cents 41 for 10/1 cotton yarns. In case of 28/1 cotton yarn, the volume to Bangladesh was much higher than China. Here, China bought Indian yarn at a higher price than sold to Bangladesh.
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