Pro Farmer Editors
The International Cotton Advisory Council (ICAC) expects world cotton trade to drop by 21% to 6.6 million tons in 2008/09.
Cotton imports are affected by lower demand from consuming countries and
lower production in exporting countries.
China (Mainland), the largest cotton
importer, is expected to receive 1.5 million tons this season, 41% less than
in 2007/08, says ICAC. India and Uzbekistan, the second and third largest exporters, are
expected to ship around 40% less cotton this season than last. However, the
largest exporter will be relatively less affected by the drop in demand -- the
United States is expected to ship 2.6 million tons in 2008/09, or 12% less
than last season, despite a sharp drop in production.
The ICAC Price Model 2007 is forecasting a 16% decline in the season-average
Cotlook A Index in 2008/09, to 61 cents per pound, with a 95% confidence
interval between 56 and 66 cents per pound.
ICAC sees world cotton area declining in 2009/10. "Declining
cotton returns, more attractive prices for competing crops, and expected
difficulties to finance production inputs are encouraging farmers to continue
switching to alternative crops. World cotton production is expected to
decrease by 1% to 23.4 million tons in 2009/10," says ICAC.