World cotton production is projected to increase by 10% during 2017/18 reaching 25.4 million tons, but stocks are projected to rise only outside China, the International Cotton Advisory Committee (ICAC) said.
It said in a statement that higher cotton prices during 2016/17 and better cotton price ratios to other competing crops during 2017 planting campaign resulted in expansion of cotton area by an estimated 3 million hectares to over 32 million hectares.
“During 2017/18 the largest gain in production of 23% to 4.6 million tons is projected in the USA. Production is projected to increase in all other major producing countries during 2017/18, including India, China, Pakistan, Brazil, Francophone Africa and Turkey,” the statement said.
According to the ICAC, global cotton mill use is projected to increase at an improved growth rate of 2.7% during 2017/18 reaching 25.2 million tons. In comparison, during 2016/17 world cotton mill use grew by 1.6%. Mill use in China is projected to grow by 1.5% to 8.1 million tons. Cotton mill use is also projected to grow moderately in India, Pakistan, Turkey, Bangladesh, Vietnam and Brazil.
In 2017/18, world trade is projected stable at 8 million tons and USA will remain the largest exporter accounting for 40%, or 3.1 million tons of world shipments, the ICAC said, adding that Bangladesh will remain the largest importer in 2017/18 accounting for 18%, or 1.4 million tons of world imports.
“Because world production is projected to edge over mill use during 2017/18, world ending stocks could increase moderately and reach 18.7 million tons with stocks to use ratio remaining little changed at 75%. However, ending stocks in China are projected to decline by 1.7 million tons during 2017/18, while outside China stocks are projected to increase by 1.85 million tons,” the statement said.
|WORLD COTTON SUPPLY AND DISTRIBUTION|
|Changes from previous month|
|Million Tons||Million Tons|
|Cotlook A Index*||70||83||69*|
(*The price projection for 2017/18 is based on the ending stocks to mill use ratio in the world-less-China in 2015/16 (estimate), 2016/17 (projection) and 2017/18 (projection); on the ratio of Chinese net imports to world imports in 2016/17 (projection) and 2017/18 (projection); and on the price projection of 2016/17. The price projection is the mid-point of the 95% confidence interval: 58 cts/lb to 84 cts/lb.)