Australia's cotton industry is anticipating a significantly reduced yield in the 2014/15 harvest if the ongoing drought in the country's cotton-growing regions does not ease.

Adam Kay, CEO of peak industry body Cotton Australia, told just-style that if the very dry conditions continued, preliminary forecasts were for a total harvest of around 2.5m bales in the 2014/15 season, compared to the nearly 4m bales harvested in 2013/14.

"This could all change if we get rain however, and if we get enough in the right places we could look at substantial increases on those figures," he said, adding that more accurate forecasts could be anticipated in early November.

Australian cotton exports are worth around AUD1.50bn (US$1.40bn) according to the country's national science agency, the Commonwealth Scientific and Industrial Research Organisation (CSIRO).

Kay said that currently 70% of Australian cotton is exported to China, 10% to Indonesia and 10% to Thailand and that Australia was well-placed to supply the vibrant Asian apparel and textile markets.

"There is a lot of interest in expanding cotton production in Australia right now. We have counter seasonal production to the northern hemisphere, short shipping times to Asia and high quality, reliable product that's in demand. Some farmers are forward selling up to three years in advance," he said.