Cotton and Products Update

An Expert's View about Cotton in Turkey

Posted on: 19 Dec 2012

The MY 2012 Turkish cotton crop is now projected a 410,000 hectares and 600,000 MT (2.7 million bales).

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: 11/29/2012 GAIN Report Number: Turkey Cotton and Products Update Cotton Update Approved By: Clay Hamilton, Ag Counselor Prepared By: Ibrahim Sirtioglu, Ag Specialist Report Highlights: The MY 2012 Turkish cotton crop is now projected a 410,000 hectares and 600,000 MT (2.7 million bales). Despite a higher than projected planting area in the Aegean region, high heat waves, floods and repeated insect attacks during the season adversely affected yields. High domestic production in MY 2011 caused imports to decline roughly thirty percent to 518,000 MT (2.3 million bales). However, MY 2012 imports are expected to recover and reach 750,000 MT (3.3 bales) as a result of increase domestic consumption and a lower local crop. US exports were about 252,000 MT (0.9 million bales) in MY 2011. Availability of GSM-102 Credit Guarantee Program played an important role in U.S. exports to Turkey, where total registration reached US$ 160 million during FY 2012. Post: Ankara Production MY 2012 cotton area and production are now estimated at 410,000 hectares and 600,000 MT. Planting and production were higher than early projections in the Aegean region, which compensated for losses caused by the late season rains and floods in the Southeast Anatolian region. Excessive rains early in the season in some regions, high heat during summer months, and repeated insect attacks all contributed to lower yields. Available information on ginning for the last two marketing years indicate that an increase in harvester picking has also increased ginning yields, pushing total production to 470,000 MT(2.2 million bales) for MY 2010 and 770,000 MT (3.5 million bales)for the MY 2011. Consumption MY 2011 domestic cotton consumption became 1.23 MMT (5.7 million bales) and is projected to increase 1.3 MMT (5.9 million bales) during MY 2012 due to an increase in domestic consumption and exports. Changes in Chinese textile export policies with an increasing focus on domestic market, coupled with increasing Indian yarn and textile products sales to China, opened up opportunities for Turkish textile exports resulting in a higher market share in other markets. Higher domestic cotton prices and production costs in China have also helped Turkish textile exporters to compete with Chinese products in international markets successfully. Turkish mills are consistently investing in new machinery and renewing their plants to have a lower cost and larger production. Turkish mills are benefiting from high technology and geographical proximity to the EU, the Middle East and North African markets. Trade Imports for MY 2011 became 518,610 MT (2.38 Million bales) representing about a thirty percent drop compared to the previous year due to increased local supply. The U.S. provided about half of the imports 252,663 MT (1.15 million Bales). Sudden changes in world cotton prices during the last two seasons caused millers to prefer small orders from the domestic market or near-by sources such as Greece. Imports during the first two months of MY 2012 were 86,906MT. The U.S. was the leading supplier with 50,621MT followed by Turkmenistan (11,744 MT), Brazil (9,023 MT) and Greece (5,522 MT). During MY 2012 imports are expected to increase to 750,000 MT due to a larger domestic use and lower domestic production. Additionally, heavy rains during the picking season adversely affected the quality of some of the local cotton that will increase the need for high quality imported cotton. GSM-102 credit guarantee program continues to play a critical role in U.S. cotton sales to Turkey. During FY 2012 Turkish cotton importers registered US$ 160 million worth of U.S. cotton under the program, which represents about twenty-three percent of Turkey’s total usage for the financial year. During MY 2011 Turkish total cotton exports (including hydrofoil cotton for medical use) reached 65,237 MT, of which 35,654 MT were lint cotton for textile use and the rest 29,584 MT were hydrofoil cotton for medical use. About half of the exported lint cotton was to the Mersin Free Trade zone that can be imported back in to the country later. China (6,000 MT) and Indonesia (2,700 MT) were the other leading export destinations. Important note: Starting with this report post, as agreed with Washington, will include hydrofoil cotton exports in export figures on the PSD and will also add on the others not listed category in the Trade matrix. PSD, Cotton MT Turkey Cotton (HECTARES)(MT) 2010 Revised 2011 Estimate 2012 Forecast USDA Post USDA Post USDA Post Official Estimate Official Estimate Official Estimate [Old] [New] [Old] [New] [Old] [New] Market Year Aug-10 11-Aug 12-Aug Begin Area Planted 320000 320000 490000 490000 400000 410000 Area Harvested 320000 320000 490000 490000 400000 410000 Beginning Stocks 254068 252642 191671 200245 166671 193618 Production 460000 460000 750000 770000 630000 600000 Imports 729428 729428 520000 518610 600000 750000 MY Imp. from 476925 476925 230000 252663 350000 400000 U.S. TOTAL SUPPLY 1443496 1452070 1461671 1488855 1396671 1543618 Exports 31825 31825 65000 65237 40000 40000 USE Dom. 1220000 1220000 1230000 1230000 1200000 1300000 Consumption Loss Dom. 0 0 0 0 0 0 Consumption TOTAL Dom. 1220000 1220000 1230000 193618 1200000 1300000 Consumption Ending Stocks 191671 200245 166671 193618 156671 203618 TOTAL 1443496 1452070 1461671 1488855 1396671 1543618 DISTRIBUTION PSD Table (bales 1000) Cotton 2010/2011 2011/2012 2012/2013 Turkey Market Year Market Year Market Year Begin: Aug 2010 Begin: Aug 2011 Begin: Aug 2012 USDA New USDA New USDA New Official Post Official Post Official Post Area Planted 0 0 0 0 0 0 Area Harvested 320 320 490 490 400 410 Beginning Stocks 1,928 1,160 1,722 921 1,724 890 Production 2,110 2,157 3,440 3,534 2,750 2,755 Imports 3,350 3,350 2,382 2,380 3,500 3,443 MY Imports from U.S. 0 2,189 0 1,160 0 1,836 Total Supply 7,388 6,667 7,544 6,835 7,974 7,088 Exports 146 146 300 300 200 185 Use 5,600 5,600 5,600 5,645 6,000 5,967 Loss -80 0 -80 0 -80 0 Total Dom. Cons. 5,520 5,600 5,520 5,645 5,920 5,967 Ending Stocks 1,722 921 1,724 890 1,854 936 Total Distribution 7,388 6,667 7,544 6,835 7,974 7,088 Stock to Use % 30 16 29 15 30 15 Yield 1,436. 1,468. 1,529. 1,570. 1,497. 1,463. Import Trade Matrix Turkey Cotton Imports (MT) Aug/July Aug/Sept Imports from: MY 2011 MY 2012 U.S. 252,663 50,621 Others Greece 85,740 5,522 Brazil 81,638 9,023 Turkmenistan 27,290 11,744 Tajikistan 13,302 1,274 Argentina 11,341 3,162 Australia 8,458 0 Uzbekistan 7,640 447 Mersin FTZ 7,588 200 India 6,248 329 Azerbaijan 4,712 1,202 Kyrgyzstan 0 193 Total of Others 253,957 33,096 Others not listed 11,990 3,189 Grand Total 518,610 86,906 Turkey Cotton Imports (Bales) Aug/July Aug/Sept Imports from: MY 2011 MY 2012 U.S. 1,159,723 232,350 Others Greece 393,546 25,346 Brazil 374,718 41,416 Turkmenistan 125,261 53,905 Tajikistan 61,056 5,848 Argentina 52,055 14,514 Australia 38,822 0 Uzbekistan 35,067 2,052 Mersin FTZ 34,828 918 India 28,678 1,510 Azerbaijan 21,628 5,517 Kyrgyzstan 0 886 Total of Others 1,165,662 151,912 Others not listed 55,034 14,637 Grand Total 2,380,420 398,898
Posted: 19 December 2012

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