Bangladesh's cotton consumption is projected to increase slightly to 78 lakh bales in the Marketing Year 2024-25, which started in August.
The information was disclosed in a recent report published by the US Department of Agriculture (USDA).
The USDA predicted that Bangladesh may consume 78 lakh bales of cotton in the MY25; among these, the country will import 77 lakh bales.
Bangladesh is the second-largest exporter of readymade garment (RMG) items and the largest importer of raw cotton.
The USDA projected in April that Bangladesh's domestic cotton use for MY25 would be 80 lakh bales. However, in September, the US agency revised its cotton export prediction to 77 lakh bales.
Meanwhile, in its recent report "Cotton: World Markets and Trade," the USDA slightly raised its projection for Bangladesh's cotton use to 78 lakh bales, reinforcing its status as the world's second-largest RMG exporter.
In the 2023-24 period, West African countries continued to be Bangladesh's main suppliers of raw cotton, with India, Brazil, and the US.
Bangladesh allowed the import of US cotton without fumigation on arrival after nearly half a century of mandated fumigation.
Bangladesh has repeatedly asked the US to allow duty-free access for RMG items made from imported US cotton, as it has long been denied preferential export terms.
Bangladeshi apparel exporters said that removing the required fumigation tests for US cotton would simplify trade and lower the time and cost of importing US cotton.
There is clear potential for US cotton growers and exporters to tap this market further, as Bangladesh has positioned itself as a major supplier of apparel items worldwide.
The exporters said they can further explore opportunities if duty-free access is granted to apparel items made of US cotton.
According to the USDA's Foreign Agriculture Services (FAS), Bangladesh is the fifth-largest export market for US cotton, with export values exceeding $339 million in 2023.
In the World Bank Commodities Price Data (The Pink Sheet) of July-September 2024 (published on October 2), global cotton prices declined 15% to $1.79 per kg, compared to $2.11 in the same period in 2023.
Regarding this, local industry insiders said that yarn production will increase this year, which may increase the import of cotton and domestic use.
They also added that due to the gas crisis and hike in energy prices, along with the unavailability of US dollars to open letters of credit (LCs) for cotton imports, the production of yarn witnessed a decline. However, currently, they can open LCs.
In MY25, Bangladesh consumed 76 lakh bales of cotton. However, total cotton cultivation in Bangladesh covers only 0.55% of the country's 8.1 million hectares of arable land.
Moreover, domestically produced cotton accounts for less than 2% of total cotton consumption in the country.