Interviews
Cotton trade projected to trend upward at 2.2 % until 2019
19 Feb '10
5 min read
The Central Asian countries of the FSU have been the world's second-largest exporter since the early 1990s. However, Government policies in Central Asia promoting investment in textiles have resulted, to some extent, in more exports of textile products rather than exports of raw cotton, thereby somewhat limiting the region's growth in the projection years.
Sub-Saharan Africa's exports rose rapidly during much of the last decade, but since 2006, low world prices and the strength of the Communaute Financiere Africaine (CFA) franc—due to its link to the euro—have led to lower output and exports by West Africa. The planted area in the 14 member countries of the CFA has fallen to its lowest level since just after the 1994 devaluation of the CFA franc. Some rebound in output is expected as these economies develop and as Bt cotton is adopted by the region's producers. Sub-Saharan Arica's exports are projected to rise more than one-third during the next 10 years.
Improved cotton yields in India, largely due to the adoption of hybrid cotton containing the Bt gene, have raised India's production and exports in recent years. Yield growth is projected to continue as the area planted to hybrid cotton expands and cultivation practices improve. The increase in cotton output is expected to enable India to increase domestic textile production and exports. Its export volume has already surpassed those of Sub-Saharan Africa and Central Asia, and it is expected to maintain this rank throughout the forecast period.
U.S. mill use of upland cotton continues to decline in the projections while cotton exports rise:
The decline in mill use of cotton is projected to continue over the next decade. At the end of the projection period, domestic mill use is projected to represent less than 16 percent of total use. Underlying this projection is an increase in apparel imports by the United States over the next 10 years, reducing domestic apparel production and lowering the apparel industry's demand for fabric and yarn produced in the United States.
U.S. upland cotton exports have fallen sharply in 2009/10, reflecting two years of reduced acreage and production and diminished availability of stocks. Exports in 2010/11 are projected to rebound and then grow moderately through the rest of the projection period.
As a consequence, the U.S. cotton's share of world trade grows from its 2009/10 share of about 32 percent to about 35 percent by 2019/20.
As projected cotton prices strengthen, higher net returns than realized in 2009/10 provide economic incentives for cotton acreage to rise and production to increase. As a consequence, cotton stocks are projected to rise over the next decade.
Sub-Saharan Africa's exports rose rapidly during much of the last decade, but since 2006, low world prices and the strength of the Communaute Financiere Africaine (CFA) franc—due to its link to the euro—have led to lower output and exports by West Africa. The planted area in the 14 member countries of the CFA has fallen to its lowest level since just after the 1994 devaluation of the CFA franc. Some rebound in output is expected as these economies develop and as Bt cotton is adopted by the region's producers. Sub-Saharan Arica's exports are projected to rise more than one-third during the next 10 years.
Improved cotton yields in India, largely due to the adoption of hybrid cotton containing the Bt gene, have raised India's production and exports in recent years. Yield growth is projected to continue as the area planted to hybrid cotton expands and cultivation practices improve. The increase in cotton output is expected to enable India to increase domestic textile production and exports. Its export volume has already surpassed those of Sub-Saharan Africa and Central Asia, and it is expected to maintain this rank throughout the forecast period.
U.S. mill use of upland cotton continues to decline in the projections while cotton exports rise:
The decline in mill use of cotton is projected to continue over the next decade. At the end of the projection period, domestic mill use is projected to represent less than 16 percent of total use. Underlying this projection is an increase in apparel imports by the United States over the next 10 years, reducing domestic apparel production and lowering the apparel industry's demand for fabric and yarn produced in the United States.
U.S. upland cotton exports have fallen sharply in 2009/10, reflecting two years of reduced acreage and production and diminished availability of stocks. Exports in 2010/11 are projected to rebound and then grow moderately through the rest of the projection period.
As a consequence, the U.S. cotton's share of world trade grows from its 2009/10 share of about 32 percent to about 35 percent by 2019/20.
As projected cotton prices strengthen, higher net returns than realized in 2009/10 provide economic incentives for cotton acreage to rise and production to increase. As a consequence, cotton stocks are projected to rise over the next decade.
United States Department of Agriculture
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