Robust global cotton mill demand draws down stocks
01 Dec '07
3 min read
World cotton ending stocks for 2007/08 (August/July marketing year) are forecast at 54.8 million bales, 6 million below last season and the lowest since 2003/04. This season's reduction in stocks is attributable to the above-average growth expected in global cotton mill use and a decrease in 2007/08 world cotton production.
The global stock decline is largely accounted for by a handful of countries, including the United States, China, Australia, and Pakistan. These countries account for nearly 80 percent of the world stock reduction in 2007/08. Stocks in the United States are forecast to fall 1.9 million bales to 7.6 million but remain the second largest since 1985/86.
Global cotton production in 2007/08 is projected at 119.4 million bales, 2 percent below last season's output of 121.9 million bales and the third largest cotton crop on record. Production is mixed among the major producing countries this season. China—the world's largest producing country—is forecast to match last season's crop of 35.5 million bales.
India is expected to produce 1.7 million bales more in 2007/08, while the U.S. crop is forecast to decline 2.7 million. Total foreign cotton production in 2007/08, however, is estimated at 100.5 million bales, slightly above last season and a record.
World cotton mill use is projected to continue its rapid rise to a record 129.2 million bales in 2007/08, nearly 5 percent (6 million bales) above 2006/07. Foreign cotton mill use is expected to reach a high and approach 125 million bales, while U.S. mill use declines further. Foreign cotton mill use is forecast to increase for the ninth consecutive season.