USDA forecasts global cotton output at 119.4mn bales

24 Oct '14

4 min read

However, while consumption is forecast to improve in 2014/15, cotton trade is forecast to decline considerably, due in large part to China’s anticipated reduction in raw cotton imports. USDA estimates global cotton imports at 34.4 million bales for 2014/15.

This figure is sizeably down from 40.7 million bales in 2013/14 and a record 46.2 million bales in 2012/13. China’s policies are expected to reduce their raw cotton imports to 7 million bales in 2014/15, half the level of the previous season.

In addition, Turkey is forecast to import less in 2014/15 as a result of a larger crop. Moderating the global import decline to some extent are increases for Bangladesh, Vietnam, and Indonesia. Meanwhile, exports are seen lower for the major shippers with the exception of Brazil.

India’s exports at 5 million bales are forecast to decline nearly 50 percent as a result of China’s reduced import demand. Australia’s exports are projected to be down by one-third as lower production there reduces exportable supplies.

Based on the latest cotton supply and demand projections, USDA projects world ending stocks at a record 107.1 million bales in 2014/15, 5.8 million bales or nearly 6 percent above the previous season.

The stocks-to-use ratio is forecast to reach 94 percent this season, up slightly from last season and well above the 40-percent ratio seen in 2009/10. In 2014/15, China is expected to account for 58 percent of global cotton stocks, a slight decline from the previous season.

With world stocks at a record and the anticipation of China’s policy effects, cotton prices are forecast to decline, USDA says. It informs that in 2014/15, Cotlook A-Index is projected to average approximately 70 cents per pound, compared with 2013/14’s 91 cents per pound. (AR)

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