The 2007 China Cotton Conference was held in Urumqi, Xinjiang on June 27 - 29, drawing a record crowd of over 800 in attendance, including a large number of foreign delegations. Topics discussed were rather diverse, with the center of attention on the size of the 2006/07 Chinese cotton crop, consumption and unsold stocks.

A clear consensus emerged from the Chinese delegates' presentations that the 2006 Chinese crop equaled at least 7.1 million tons due to an underestimation of the Xinjiang crop. In regard to the 2007 crop, there was agreement that output at this juncture looks set to reach or exceed last season, which means production of 7.1 million tons or more. As to consumption, there was no clear consensus, with the issue being centered on the problems with the current NBS surveys on yarn output.

International traders found some relief from the fact that it is now obvious that China's domestic stocks of high-grade cotton have significantly tightened. Amid this tightness, new sales of both consignment cotton and new sales were active during the conference. Chinese mills clearly need high-grade M 1-3/32" and higher cotton. Imported cotton is also cheaper than local cotton, which is another new incentive for imports.

Another feature that emerged from the conference, where a large delegation of Indian ginners and merchants were present, was the new role India is playing in Chinese cotton trade. Indian new crop is again set to dominate turnover in imported cotton during the November 2007 through March 2008 time period. The availability of very cheap freight between Indian and Chinese ports has helped contribute to the popularity of Indian cotton. Freight costs of 50 to 150 U.S. dollars per container are being quoted, with even cheaper rates having been quoted at some point. Ginners are increasingly selling the Gujarat crop FOB a Gujarat port, which is further enhancing the attractiveness of Indian cotton. The improvement in quality has also added to the willingness of Chinese mills to expand usage.