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  • 6.9.6-MARKET PROFILES-THE DOMESTIC MARKET: A MICRO VIEW

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  • The domestic market: a micro view

    Chapter 6 - Market profiles - Vietnam  

     
     
    Viet Nam is largely dependent on imports of raw cotton as domestic production can supply only 15%-20% of demand. The balance of 80%-85% has to be imported.

    Raw cotton is often imported into Viet Nam directly by textile mills and garment companies under standard contracts for sale and purchase that are prepared by agreement between the buyer and seller. The usual mode of payment is letter of credit (L/C) at sight and the usual delivery terms are CIF (cost, insurance, freight - Incoterms).

    There are no specialized trading houses or agents for the import and distribution of cotton materials in Viet Nam. For domestically produced cotton, the Vietnam Cotton Company, based in Ho Chi Minh City, is the only selling agent. It provides investment inputs such as fertilizer, pesticides, and cottonseed to farmers and buys back cotton harvest from them.