The Dubai Cotton Centre (DCC) has traded 20,000 tonnes of Uzbek cotton over the past three and a half months and has placed a new order for 70,000 tonnes, an executive said on Wednesday. The cotton was bought by traders in Bangladesh, Malaysia and Singapore, Ashok Das, head of commodities at DCC told Reuters in an interview.

"And for the new cotton season which starts in November until July we have already signed a contract with Uzbekistan to trade 70,000 tonnes which can increase up to 100,000 depending on demand," said Das. The contract should cover traders demand till June 2010, said Das. "And after the operation is stable, in about 12 months time we will be looking at trading cotton from other origins such as Africa."

Established in April, the DCC is a redistribution and trading post for cotton from Uzbekistan en route to Asia. Storing large quantities of cotton in Dubai will help save up to 40 days of shipping time for Asian importers, said Das. So far the DCC only has 20 members but Das hopes the number will increase to 100 over the coming two months. "The operation is still very new and not a lot of people know the advantages it provides in terms of cutting down on shipping time."

Cotton to be traded at the DCC will be shipped directly from Bandar Abbas to Dubai for storage. Last year DCC, a trading arm and a fully owned subsidiary of the Dubai Multi Commodities Centre (DMCC), clinched an import deal with Uzprommashimpeks (UPM) to supply the cotton centre. UPM is one of the largest cotton exporters in Uzbekistan, which is the world's third-largest cotton exporter. The economic crisis dampened global cotton demand, leading the DCC to open three months later than previously announced.

Source: Reuters