In the 2023/24 season, the cotton cultivation area in Uzbekistan is expected to be 950,000 hectares, a 3% decrease compared to the previous year. The main reason for this decrease is the government’s redistribution of land to promote food security and increase farmers’ income.
For the 2023/24 season, the Uzbekistan government has proposed a minimum cotton price of approximately 65 cents per kilogram. Many cotton farmers and collectives have not been able to make a profit from cotton cultivation, with profit margins ranging only between 10-12%. In the medium term, declining profits may result in a reduction in cultivation area and a decrease in cotton production.
The cotton production in Uzbekistan for the 2023/24 season is estimated to be 621,000 tons, an 8% decrease compared to the previous year, primarily due to unfavorable weather conditions. Additionally, due to low cotton prices, some cotton has been abandoned, and a decrease in demand for cotton fabric has led to a decline in cotton demand, with spinning mills operating at only 50% capacity. Currently, only a small portion of cotton in Uzbekistan is mechanically harvested, but the country has made progress in developing its own cotton-picking machines this year.
Despite increasing investments in the domestic textile industry, cotton consumption in Uzbekistan for the 2023/24 season is expected to be 599,000 tons, an 8% decrease compared to the previous year. This decline is due to reduced demand for cotton yarn and fabric, as well as decreased demand for ready-made garments from Turkey, Russia, the United States, and the European Union. Currently, almost all of Uzbekistan’s cotton is processed in domestic spinning mills, but with shrinking demand, textile factories are operating at a reduced capacity of 40-60%.
In a scenario of frequent geopolitical conflicts, declining economic growth, and decreasing garment demand globally, Uzbekistan continues to expand its textile investments. Domestic cotton consumption is expected to continue growing, and the country may begin importing cotton. With a decrease in Western countries’ clothing orders, Uzbekistan’s spinning mills have started to accumulate stock, resulting in reduced production.
The report indicates that Uzbekistan’s cotton exports for the 2023/24 season have decreased to 3,000 tons and are expected to continue declining. Meanwhile, the country’s exports of cotton yarn and fabric have significantly increased, as the government aims for Uzbekistan to become an exporter of clothing.
Post time: Dec-27-2023