Global cotton estimates have been lowered

Global cotton estimates have been lowered

Estimates for 2015/16 global cotton production, consumption and ending stocks have been lowered based on current indications of harvest results in the northern hemisphere.

According to the US Department of Agriculture's (USDA) monthly World Supply and Demand Estimates report, world cotton production is lowered 1.75m bales to 105.63 bales, with reductions in India, Pakistan, China, Greece, Mali, and Mexico. 

With consumption reduced mainly for China and Pakistan, total world consumption is now projected to grow a modest 1.1% this season. 

Global ending stocks are projected at 106.09m bales, nearly 6m bales below the beginning level, and below USDA's earlier forecast of 106.97m bales. 

US production estimates are reduced 57,000 bales to 13.28m bales from 13.34m last month as decreases for the Southeast and Delta are mostly offset by an increase for the Southwest. 

Meanwhile, ending stocks, domestic mill use and exports are unchanged. The predicted average price of 55-63 cents per pound is narrowed on both ends, with the mid-point unchanged from last month at 59 cents. 

However, while global cotton production is expected to drop significantly in 2015/16 – just as consumption is forecast to rise – the amount of cotton held in stocks means a shortage is unlikely, an industry expert said recently.

Cotton shortage unlikely despite demand exceeding supply