The Agricultural Development Bank is the chief supplier of cotton procurement fund. The bank provided RMB55.725 billion loans in 2007 for the procurement of 4.458 million MT cotton, accounting for 58% of the nation’s cotton production. The banks’ loans to cotton companies totaled RMB11.435 billion in the first half of this year.

The bank has recently unveiled its loan policy on cotton procurement in Year 2008. Its principles of loan supply are to give priority to well-performed companies, scrutinize loan applicants’ qualifications and set a limit to the amount of loans.

BOABC considers that the bank’s tight control of loans may push down cotton price in the nation in the short run. When the verification of procurement companies’ qualifications is concluded on Aug. 20, the bank will begin to release loans for the new crop year. By then cotton price is predicted to pick up.

List

News Briefs 1

Cotton Price Influenced by Banks’ Loan Policy 2

Outlook of Cotton Price Trend 3

Tax Rebate Rate Raised for Textile Exports 4

Investment in Textile Industry in First Half of 2008 5

Textile & Garment Exports in July 6

Weather & Cotton Conditions 7

Price Trends: 9