Chinese textile companies show great interest in Australian cotton farm

Keith De Lacy, the president of Cubbie Station, the biggest cotton farm and irrigator in Australia, currently show his supporting Chinese takeover of this farm, however, he asks for remaining the local management.

Chinese textiles giant Shandong Ruyi has lodged an application with the Foreign Investment Review Board to buy Cubbie, the 96,000ha southern Queensland station placed into voluntary administration in 2009.

Mr Loh, Shanghai-based cotton trader, told that China was the world's largest producer, consumer and importer of cotton. In the 2011-12 season, China produced 7.3 million tonnes of cotton and consumed 8.7 million tonnes.

Wang Yuhui, president of two successful Chinese textile companies, said that while his operations had no concrete plans to buy or invest in cotton farms in Australia, it was something he was considering.

"This is a good choice for whole-chain manufacturing," Mr Wang, president of Hebei Spring Textiles and Hebei Xindadong Textiles Printing and Dyeing, said through a translator.

"We don't have exactly a plan; we just think about it and consider it. But lots of Chinese mills may be very interested."

His mills process more than 26,000 tonnes of cotton each year, of which 15,000 tonnes are imported from Australia.

He said textiles companies aimed for the "whole-chain" system, which meant they controlled the cotton from when it was grown to when it was transformed into garments and marketed.

Mr Wang said he believed it was cheaper to grow cotton in Australia, where it was picked by machines, than in China, where it was picked by hand.

"The quality of Australian cotton is really good, especially with not any contamination (because it is machine-picked)," he said.

"The cost of labour in China is increasing and in Australia the farm is very big and the production is centralised.