The International Cotton Advisory Council (ICAC) expects global cotton acreage to decline to 32.2 million hectares in 2013-14, which if realized, would be a 5% drop from the previous year. It sees global cotton production at 24.6 MMT, down 6%.
ICAC says from 2012-13 to 2013-14, cotton production in China and the United States is each forecast to fall by 700,000 MT to 6.7 MMT and 3 MMT respectively, and production in India is forecast to decline by 170,000 MT to 5.7 MMT as farmers continue to switch out cotton for more profitable alternatives. "China’s production decline is also attributed to labor shortages as farm workers migrate to cities searching for urban employment," says ICAC.
Global cotton consumption is seen rising by 2.3% to 24.25 MMT in 2013-14, but ending stocks are expected to climb by 2% from the previous year to 18.25 MMT. "Assuming the Chinese government adheres to the current reserve policy, the Cotlook A Index is projected to average 88 cents and 122 cents per pound in 2012-13 and 2013-14, respectively," says the group.