ICAC lowers world cotton production forecast
Jul 3, 2008 8:04 AM
The International Cotton Advisory Committee says world cotton production could decline 3 percent to 117 million bales in the 2008-09 marketing year, raising world cotton prices by nearly 10 cents per pound.
The International Cotton Advisory Committee says world cotton production could decline 3 percent to 117 million bales in the 2008-09 marketing year, raising world cotton prices by nearly 10 cents per pound.
The ICAC, an association of 43 governments of cotton producing and consuming countries, said much of the decrease will occur in the United States where planted acreage has fallen to 9.3 million for a decline of 27 percent since 2006’s 12.7 million acres.
Smaller decreases are expected in China, Brazil, Egypt, Turkey and central Asia while increases could occur in India, Australia, the former French colonies in Africa and in Pakistan.
The ICAC says global cotton mill use could decline by 1 percent in 2008-09 to 122 million bales (from 122.9 million in the 2007-08 marketing year, which ends July 31) due to projected slower global economic expansion and higher prices of cotton relative to polyester.
Exports of raw cotton are expected to increase by 5 percent to 41 million bales (from 2007-08’s 37.6 million bales), driven by what it anticipates will be larger Chinese imports.
World cotton stocks are forecast to decrease by about 4.7 million bales (to 51 million bales) with the lion’s share of the decline expected to occur in the United States. The ICAC said it expects the large stocks in the latter will help increase U.S. cotton exports.
The ICAC Secretariat forecasts an increase in the season-average Cotlook A Index from 73 cents per pound in 2007-08 to 82 cents per pound in 2008-09 as exportable supplies in the United States and other countries are reduced.
