USDA predicts surge in global cotton supply for 2024-25 season

The USDA has projected the total global production at 119.05 million bales, out of which 116.86 million bales will be for domestic consumption in the producing countries.

In its monthly WASDE report released on Friday, the USDA announced that global cotton consumption is projected to rise by 3 per cent year-on-year, and ending stocks are expected to increase as well. Production is anticipated to grow nearly 5 per cent in 2024-25 as both global area and yield are expected to rise.

According to the report, larger crops in Brazil, the United States, and Turkiye more than offset smaller crops in China and India. Greater global supplies are expected to increase use and elevate world trade to a four-year high. As production outpaces consumption growth, global ending stocks are projected to rise by 2.5 million bales to 83.0 million bales.

The global 2023-24 estimates show higher production and consumption compared with the previous month. Australia’s crop has increased by 200,000 bales and India’s by 500,000 bales. Higher use in China and India more than offsets lower use in Bangladesh, Brazil, Pakistan, Turkiye, and Uzbekistan. Global ending stocks are lowered by 2.6 million bales to 80.5 million, mostly due to historical revisions to consumption in Brazil and India.

Regarding the US cotton crop, the USDA has projected a larger crop for 2024-25 as the planted area is slightly higher and abandonment is projected at less than half the rate realised in 2023-24. Production is forecast at 16.0 million bales, based on 10.67 million planted acres as indicated in the March Prospective Plantings report, with the harvested area expected to rise by 2.7 million acres year over year to 9.1 million.

US abandonment is projected below the 10-year average, reflecting moisture conditions to date in the Southwest. Despite a lower national yield, production is forecast nearly 4 million bales larger. Although beginning stocks are lower, the total supplies for 2024-25 are projected 12 per cent higher. Exports are expected to rise by 700,000 bales due to increased supplies and higher world trade, while US mill use is expected to increase by 100,000 bales. At 3.7 million bales, the 2024-25 US ending stocks are projected 1.3 million bales above the relatively low 2023-24 level. The marketing year average Upland farm price is projected at 74 cents per pound, 2 cents below the previous year.

For 2023-24, the final US cotton production is estimated at 12.1 million bales. Exports are unchanged, with mill use slightly increased due to activity to date. Ending stocks are estimated lower at 2.4 million bales, while the projected season-average price remains unchanged.

Fibre2Fashion News Desk (KUL)