World cotton production is estimated up 1% for 2014/15

World cotton production is estimated up 1% for 2014/15

Recent gains in cotton’s price attractiveness could put a halt to the loss in planted area to competing crops such as wheat and maize, says the International Cotton Advisory Committee (ICAC).

ICAC said falling cotton prices had made it less attractive to farmers than a year ago when compared to wheat, maize, soy, rice and sugar, but added that recent trends had improved the situation.

With record cotton stocks and international prices down to an average of 68-70c/lb for much of the season, those prices held steady in early 2015, while the value of competing crops fell back.

"The recent gain in the price attractiveness of cotton may mitigate the loss in area to competing crops," ICAC said, noting that the world cotton area was forecast to fall 7% to 31.3m hectares (ha) in 2015/16, sending world production down 9% to 24m tons.

For 2014/15, world production is estimated up 1% to 26.4m tons, led by India, where the cotton area has reached a record high of 12.3m ha – but where erratic monsoon rains impacted yields, leaving production only fractionally up on last year.

Production in the US surged up 26% on the back of a 29% area gain, but China, Pakistan and Brazil all saw their planted areas and production fall.

World cotton consumption is estimated up 3% to 24.1m tons in 2014/15, with Asian demand dominating.

But ICAC said that, despite a recovery in consumption, it expected a production surplus of 2.3m tons, sending world ending stocks up 12% to 21.8m tons, or 90% of current global consumption.

However, it added that stocks could diminish by 3% in 2015/16 to 21.2m tons.