COTTON: The 2011/12 U.S. cotton supply and demand estimates include lower production, domestic mill use, and ending stocks compared with last month. Production is reduced 473,000 bales due to decreases in all regions except the far West.
Domestic mill use is reduced 200,000 bales based on lower-than-expected use in recent months. The export estimate remains at 11.3 million bales. Ending stocks are now forecast at 3.5 million bales, or 23.5 percent of total use. The forecast marketing year average price received by producers of 85-95 cents per pound is narrowed 1 cent on each end of the range.
Lower consumption is boosting forecast 2011/12 world ending stocks by 2.7 million bales this month. Beginning stocks are raised nearly 300,000 bales and world production is forecast nearly 500,000 bales lower, due mainly to the reduced forecast for the U.S. crop. World consumption is reduced sharply, reflecting continued weak mill demand owing to an uncertain world economic outlook and a loss of fiber share to polyester.
Consumption is lowered for most major world cotton spinners and includes a 1.0-million-bale reduction for India and reductions of 0.5 million bales for both China and Turkey. World trade is revised up slightly, despite lower world consumption, due to strong import demand by China, which is supported by purchases for the national reserve.
World ending stocks are now forecast at 57.7 million bales, an increase of 27 percent from 2010/11, and accounting for 52 percent of world consumption.
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December WASDE Report Coverage
See all of the report numbers and analysis from today's World Agricultural Supply and Demand Estimates and Crop Production reports.