WASDE: U.S. Cotton Production, Ending Stocks Could Increase in 2016

May 10, 2016 11:03 AM
WASDE: U.S. Cotton Production, Ending Stocks Could Increase in 2016

A projected 2016/17 U.S. cotton crop of 14.8 million bales is expected to boost next season’s ending stocks well above the beginning level. Production is anticipated to rise 15 percent from 2015/16, based on 9.6 million planted acres as indicated in Prospective Plantings, combined with below-average abandonment, due to relatively favorable moisture, and average yields. Domestic mill use is projected stable at 3.6 million bales, while exports are expected to rise to 10.5 million, on higher available supplies and more marketable qualities. Ending stocks are projected at 4.7 million bales, or one-third of total use. The preliminary range for the marketing year average price received by producers is 47.0 to 67.0 cents per pound.

For 2015/16, U.S. cotton production is increased marginally. The export forecast is reduced to 9.0 million bales, reflecting lower-than-anticipated export sales to date, with ending stocks raised accordingly.

The world 2016/17 cotton projections show a decline in stocks of more than 6.0 million bales, as consumption exceeds production for the second consecutive season. Global production is expected to rise nearly 5 percent, despite marginally lower area, as yields recover from weather and pest pressures that affected crops in 2015/16. Production is forecast to rise mainly in Pakistan, the United States, India, and Turkey, partially offset by a 1.3-million-bale reduction for China. Global consumption is projected to rise 1.6 percent, as prices overall remain low and mills in China gain access to domestic cotton at more competitive prices. Projected world trade is lowered slightly from 2015/16 as increased production, especially in Pakistan, reduces reliance on imports. Ending stocks are projected at 96.5 million bales, 87 percent of world consumption. Falling China stocks exceed the projected global decline while stocks outside of China show a slight increase. Despite the projected decrease, China stocks are equivalent to nearly 170 percent of China’s total disappearance.

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