Tashkent, Uzbekistan (UzDaily.com) – About 122 clusters work in the cotton and textile industry of the Republic of Uzbekistan, according to the Ministry of Agriculture of the Republic of Uzbekistan, the total production of raw cotton this year amounted to 3.4 million tons.

The procedure for the sale of cotton fiber in the domestic market is regulated by the following regulations:

- By the Resolution of the Cabinet of Ministers from 25 January 2018 No. 53 (paragraph five of clause 2: “the volumes of cotton fiber produced in excess of the need for own production capacities are sold by the organizer of cotton and textile production to other domestic consumers through exchange trading”);

- Resolution of the Cabinet of Ministers from 12 February 2018 No. 106 (Appendix No. 2 to the decree: "Regulations on the procedure for selling cotton fiber at exchange auctions");

- By Decree of the President of the Republic of Uzbekistan from 5 May 2020 No. UP-5989 (clause 1: “To establish that the starting price of domestically produced cotton fiber of basic quality is determined by the seller based on the value of the futures price of the New York Mercantile Exchange for the next month of delivery”).

Taking into account the growing needs of textile enterprises of the republic in high-quality cotton fiber, the Uztekstilprom Association, with the active support of the Ministry of Investment and Foreign Trade of the Republic of Uzbekistan, has worked out measures to improve the procedure for selling cotton fiber on the exchange, in particular, in order to exclude speculative price increases, the starting price of the base the quality of the cotton fiber is set at the level of the New York futures quotation for the next trading month.

In this regard, the industry is strongly encouraged to:

- not to buy cotton fiber at disproportionately high prices, for example, higher than the New York futures for the next trading month;

- when working on tolling raw materials, work out the ratio of the shares (percent) of the offered processing services, taking into account the economic feasibility (for example, 62% by 38% with ring spinning and 67% by 33% with rotor spinning).

Market analysis and calculations show that when purchasing cotton fiber at inflated prices, the risks of unreasonable losses in the sale of yarn increase (in Turkey, due to the continuing fall in the exchange rate of the lira against the dollar, imported raw materials become disproportionately expensive and, accordingly, its purchases will be limited).

At the same time, we draw your attention to the fact that in accordance with the Presidential Decree of 16.11. №UP-14, when creating cotton-textile clusters, the proposals of enterprises that have existing ones, as well as those taking investment commitments to create new capacities for deep processing of cotton raw materials (weaving, dyeing, sewing and knitwear production) will be supported.