Rising costs have led to a decline in the competitiveness of Indonesian cotton yarn exports. Vietnam and Bangladesh are particularly competitive

Cotton consumption in 2018/19 fell from 3.5 million bales to 3.1 million bales. Although the fierce competition and low-priced imported varieties at the beginning of the year led to the closure of some domestic textile factories, the expansion of large factories and the recent policy of restricting gauze imports have stabilized the cotton consumption in 2019/20 at 3.1 million bales.　　Domestic cotton mills and the entire textile industry are facing multiple severe challenges. The New Deal allows factories to be built in the free trade zone to cause a large number of low-priced imported textiles to flood into the domestic market, directly competing with domestic products, and increasing stocks of yarns and fabrics in domestic spinning mills. From January to September 2019, Indonesia's cotton yarn imports increased by 10% year-on-year, and the main sources of imports were India (41%), China (24%) and Vietnam (14%).　　 According to data from the Indonesian Ministry of Industry, the number of employees in the Indonesian manufacturing industry was 17 million in 2018, of which the textile industry accounted for 9.8%. Although cotton accounts for half of the cost of cotton yarn production, labor costs are also a key factor in product competitiveness. At the same time, the impact of environmental protection policies cannot be ignored. The policy requirements for new water treatment facilities will undoubtedly increase production costs. Some small factories cannot afford to close their doors, while large-scale spinning mills with strong funds continue to acquire small and medium-sized enterprises.　　 The increase in production costs has led to a decline in the competitiveness of Indonesian cotton yarn exports. Among them, the competition from Vietnam and Bangladesh is particularly fierce. According to the Indonesian spinning industry, the textile exports of Vietnam and Bangladesh have increased by 1028% and 699% respectively in the past 15 years, while Indonesia has only increased by 82%. The low labor costs in Vietnam and Bangladesh make their textiles cheaper than those in Indonesia.　　According to analysis, the Sino-US trade dispute will eventually increase Indonesian garment exports to the United States and cotton imports to the United States. In 2018/19, Indonesia's cotton imports fell from 3.5 million bales to 3.051 million bales, and it is expected to increase slightly to 3.1 million bales in 2019/20. In 2018/19, Indonesia imported a total of 1.18 million bales of U.S. cotton. U.S. cotton accounted for 38.53% of Indonesian cotton imports, followed by Brazilian cotton (29.06%) and Australian cotton (7.32%). At the same time, according to the statistics of the Indonesian Textile Association, from January to July 2019, the country’s textile exports were US$7.6 billion, a year-on-year decrease of US$100 million, mainly exported to the United States (35.58%), Japan (10.87%), and China (6.2%). ) And South Korea (5.05%). Article Keywords: 　Cotton Yarn Export