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Central Asia curbs cotton exports

Cotton consumption in Central Asia is expanding significantly. These countries are curbing exports as major cotton producing countries in the region such as Uzbekistan, Turkmenistan, and Tajikistan have sought to secure greater domestic supplies for inward processing and downstream exports e.g. cotton yarn, fabric, and garments. The region’s share of exports has dropped and 2019-20 shipments are projected to be less than half of the region’s exports just four years earlier. Uzbekistan banned exports starting this month. Tajikistan proposes to establish a full cycle of processing cotton by 2025. The country has recently expanded spinning capacity. Turkmenistan, the region’s second-largest producer, temporarily embargoed exports in 2018-19 so as to ensure adequate supplies for domestic consumers.

Companies are implementing a more fully integrated supply chain. They are improving efficiency of lint production via drip irrigation and machine harvesters, expanding spinning mills’ operating capacity, and further developing fabric and garment manufacturing as they shift to exports of value-added cotton products versus unprocessed lint. Expanded capacity is evident with record first quarter cotton yarn exports in the region.

Challenges with regard to expanding exports of processed products include consistent and sufficient domestic crops, affordable electricity, reliable and timely transportation for exports, and mill access to financing.

 
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