Chinese Textile Giant Urges Beijing to Issue More Cotton Import Quotas

BEIJING — China should issue more cotton import quotas in return for purchases from its bulging cotton reserves, helping reduce Beijing’s financial burden and meet demand from textile firms for high quality international cotton, said the chairman of one of the country’s biggest yarn makers. China has said it will in principle allow for no more than 894,000 tonnes of cotton imports this year, which it is required to issue under its commitments to the World Trade Organisation. But textile mills say they need more imported cotton, with domestic prices still around 10 percent higher than the global market. In a proposal submitted to China’s parliament last week, Shandong Ruyi Chairman Qiu Yafu urged the government to issue more import quota in return for mills’ purchases of overpriced reserve cotton. “Hundreds of billions of yuan (worth of cotton) is just sitting there. Every year the cotton quality degrades, the warehouse and financial costs are another tens of billions of yuan,” Qiu told Reuters. He said Beijing should redirect the money spent on holding cotton in reserves to textile mills to subsidise their purchases at prices some 35 percent higher than the market. Mills could then combine the poor quality reserve cotton with high quality imports, helping

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