Vietnam’s cotton yarn and cotton products exports have grown strongly, reflecting that cotton consumption in 2020/21 will reach a record high of 7.3 million bales, a decrease from the previous year due to the impact of the COVID-19 epidemic. That’s 700,000 packages more. According to the United States Department of Agriculture, yarn exports in 2020/21 exceeded the previous year by more than 10% in the first 11 months of this marketing year.
Foreign demand mainly comes from China, and Vietnam’s cotton yarn exports to this country account for about 60% of Vietnam’s total cotton velvet consumption.
China is the world’s largest importer of cotton yarn. Due to its geographical proximity and increased investment by Chinese companies in Vietnam, China has become Vietnam’s largest cotton yarn customer, which has also made Vietnam’s cotton yarn Exports hit a record.
China’s imports of Vietnamese cotton yarn from August 2020 to June 2021 hit a record high, equivalent to 4 million bales of cotton lint consumption. As China’s exports of fabrics and related products grow, and the country’s consumption of cotton products increases, demand in China is expected to remain strong.
The United States has imposed a temporary detention order (WRO) on cotton velvet from China’s Xinjiang region, further boosting demand for Vietnamese cotton yarn. The U.S. Department of Agriculture reports that almost all cotton yarn spun in Vietnam is made from cotton lint imported from outside China.
In order to avoid WRO, Chinese clothing and textile manufacturers may use imported cotton yarn instead of domestic cotton yarn (about 2/3 of which contains Xinjiang cotton).
Vietnam’s domestic cotton yarn consumption has increased, thereby pushing up cotton consumption. A large amount of domestic and foreign investment in Vietnam’s garment industry has boosted demand for cotton knitted fabrics and also prompted the country’s knitters to consume cotton yarn.
Vietnam customs data shows that clothing and textile exports in 2020/21 are expected to recover from the recession in the previous year and grow to more than 30 billion US dollars.
The country’s largest cotton textile and apparel export market is the United States (also the world’s largest importer). In the first 11 months of 2020/21, the United States’ Vietnam’s import volume exceeded US$5 billion, setting a record high.
Knitted cotton sweaters, pullovers and other similar clothing are the most imported product categories in the United States from Vietnam, accounting for approximately 30% of the total value of cotton products imported by the United States from Vietnam. .
China has always been the largest source of this category; however, the following 2 factors have caused Vietnam’s share of the US import market to increase—WRO in 2020 and 2021, and The United States continues to impose tariffs on China. From August 2020 to June 2021, the United States’ imports of such products increased by more than 10% compared with the same period, but imports from China decreased by nearly 20%.
The USDA report added that strong exports of cotton yarn and cotton products are expected to push up cotton consumption in 2021/22 to 7.6 million bales, and in turn promote Vietnam to become The world’s major cotton importing countries, as well as exporters and consumers of cotton yarn and cotton products.