According to a report by the United States Department of Agriculture (USDA), COVID-19 pandemic has negatively impacted Bangladesh’s marketing year (MY) 2019/2020 cotton imports and consumption. As a result Bangladesh’s raw cotton production is forecast to slightly increase over MY 2019/2020 to 146,000 bales and imports are forecast to rebound to 7 million bales.
Between August 2020 to July 2021, both yarn and fabric production rates are expected to grow to 730,000 MT and 4.1 billion meters, reflecting a 1.39 and 2.5 per cent improvement over the respective 2019-20 era estimates. The forecast increase is based on the anticipated marginal increase in New Year’s yarn and fabric demand as the local RMG sector recovers from Covid-19 ‘s negative economic effects.
In 2019-20 marketing year, yarn and fabric production forecasts have been revised down to 720,000 MT and 4.0 billion meters, which represent an 11 and 17 percent, decrease from 2018-19 figures, respectively. This decrease in production is the result of Covid-19 mitigation efforts and depressed demand as the global economy slows.
The USDA report says, in 2020-21 marketing year, the consumption of raw cotton is expected to rebound to 7.2 million bales, assuming that demand for garments will start to return to pre-Covid-19 levels. Raw cotton consumption levels in current marketing year are estimated lower at 6.9 million bales due to reduced RMG consumption in the world market as an impact of COVID-19.
Likewise, yarn and fabric usage is projected to increase by approximately 5.5 per cent to 0.95 million MT (MMT) and 3.33 per cent to 6.2 billion meters in the coming marketing year, based on increased demand as retail stores and shopping outlets reopen.