Home / Knowledge / News / Textiles / China, economy, weather key factors in cotton's outlook
China, economy, weather key factors in cotton's outlook
13
Feb '12
National Cotton Council economists say cotton's 2012 outlook will be influenced primarily by China's national reserves stocks, uncertainty over the general economy and weather developments in the southwestern United States.

Dr. Gary Adams, the NCC's vice president Economics & Policy Analysis, told delegates at the NCC's 74th Annual Meeting in Fort Worth that 2012 is not starting out as a normal year for the U.S. Cotton Belt's southwest region, particularly Texas and Oklahoma. He said drought conditions persist, and as a result, for those two states, the outlook assumes above normal abandonment and yields below trend.

Adams said the NCC sees a 2012 U.S. cotton crop of 18.30 million bales, with 17.51 million upland bales and 783,000 extra-long staple (ELS) bales. When combined with international 2012 production of 101.1 million bales, the world crop for 2012 is estimated at 119.4 million bales.

Regarding 2012 U.S. offtake, the NCC sees exports expanding to 12.9 million bales and mills consuming 3.5 million bales versus the current marketing year's 3.4 million bales.

The NCC sees 2012 world mill use of 113.8 million bales, an increase of 3.5 percent from 2011, but Adams said, "growth of this magnitude will only be achieved with competitive pricing and a rebuilding of the textile pipeline."

He also said that barring some major production problems – which is still a possibility given La Nina – global production is projected to exceed consumption and allow world ending stocks to build to 64.1 million bales.

"While that is a level comparable to 2006-09, it is important to remember that as much as 30 percent of those stocks could be held in China's government reserves," Adams said. "By late January, more than 11 million bales have been purchased into the China reserve, with some speculating that total purchases could exceed 15 million bales."

Adams noted that while China's reserves policy is providing short-term support to the cotton market, China's implementation of this policy "is the single largest wildcard in the cotton market." Regarding prices, he also noted that though the forecasted stocks/use relationship is likely to dampen upside price potential, current polyester prices and cotton's need to remain competitive with grains are supportive of prices on the downside.

For the 2012 marketing year, Adams said the strength of cotton demand will hinge on the global economy's overall health and be dependent on cotton prices that are less volatile and more competitive with polyester than what was observed in 2011. He said "A" Index of approximately $1.00 is substantially lower than year-ago levels of $1.70 – with the result that international cotton area is estimated to decline by about five percent. In the United States, the NCC's annual early season planting intentions survey found U.S. all-cotton plantings in 2012 of 13.6 million acres, down 7.5 percent from 2011.

Regarding the global economy, the NCC's outlook notes that global prospects have taken a pessimistic turn relative to views held six months earlier. The consensus of recent forecasts calls for the world economy to expand by 3-3.5 percent in 2012 and by another 4 percent in 2013.


Must ReadView All

India's garment exports up 24.93% in September 2017

Textiles | On 16th Oct 2017

India's garment exports up 24.93% in September 2017

The exports of readymade garments from India in September 2017 was...

Low GST rate on zari will generate jobs for women: SRTEPC

Textiles | On 16th Oct 2017

Low GST rate on zari will generate jobs for women: SRTEPC

There will be a rise in the employment for women with the slash in...

Consumers may suffer if no assurance to EU workers in UK

Apparel/Garments | On 16th Oct 2017

Consumers may suffer if no assurance to EU workers in UK

Consumers may suffer if the British Government does not quickly offer ...

Interviews View All

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Jurgen Gauger
Spreadshirt

‘Buying crowdsourced or creative designs are much more appealing to the...

Abhishek Ganguly
Puma India

‘As a brand, Puma is always looking for new and innovative ways to inspire ...

Nitesh Mittal

Kusumgar Corporates is a leading manufacturer of technical textiles and...

Suresh P Bagrecha

Komal Texfab, founded in 1981, is into manufacturing of knitted fabrics,...

Abhishek Pachauri

Reckon Industries adapts latest systems for manufacturing from designing...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Sidharth Sinha
Sidharth Sinha

<b>Sidharth Sinha</b> has contributed to the successful rebirth and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

October 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
76.9%
No
13.8%
Skip
9.2%

Total Votes: 65

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.5%
No
27.7%
Skip
10.8%

Total Votes: 65

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
84.6%
No
10.8%
Skip
4.6%

Total Votes: 65

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
73.8%
No
12.3%
Skip
13.8%

Total Votes: 65


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search