Cotton output recovery continues

Cotton output recovery continues

Recovery continues in cotton production for 2017-18 with a projected 11 per cent growth due to increased area to a projected 25.4 million tonne (MT).

Recovery continues in cotton production for 2017-18 with a projected 11 per cent growth due to increased area to a projected 25.4 million tonne (MT). Following the sharp drop in production in 2015-16, the 2016-17 production recovered by 7 per cent to 23 MT. Production in the US for the current season is expected to increase 25 per cent to 4.7 MT, a 930 thousand increase. India remains the world’s largest producer with 2017-18 production expected to be 6.2 MT with 8.7 per cent growth. The second largest producer, China, has production currently projected at 5.2 MT with a 7.1 per cent increase. Pakistan’s production projection for 2017-18 show a 11.5 per cent increase to 1.9 MT. Production increase in Turkey is estimated to grow 18 per cent to 8,29,000 tonne. Other major cotton producing countries are expected to have positive growth attributed to increased area and yields.

International cotton prices have continued to move upward over the last few months as the season has been underway. From the season low of 77 cents per pound at the start of season, prices are at a season high at the end of this calendar year up to 88 cents per pound.

The current season average of 80 cents per pound is lower than the 2016-17 average of 83 cents per pound. With a lower international price from the previous season and the rising price of competing fibres, global consumption is expected to grow.

After stagnating in 2016-17, global cotton demand is expected to increase 3 per cent in 2017-18 to 25.2 MT. Chinese mill use is expected to remain stable at 8.1 MT, while India and Pakistan are expected to increase 3 per cent and 4 per cent respectively. Consumption in Vietnam is expected to grow 12 per cent to 1.3 MT. Moderate growth of 2-3 per cent is expected for other major consuming countries of Bangladesh, Turkey and the US.

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