Washington, DC
November 3, 2008
Source:
International Cotton Advisory
Committee
Cotton prices continued to decline
in October. The Cotlook A Index has decreased continuously since
the beginning of the season, and is now 29% lower than it was in
early August 2008.
Global cotton mill use is projected to decline by 3% in 2008/09,
to 25.5 million tons. In particular, mill use in China
(Mainland) is expected to decline by 4% to 10.5 million tons due
to rising costs of production, the strength of the yuan against
the U.S. dollar, and slowing demand from textile importing
countries.
World cotton production is expected to decline by 6% in 2008/09,
to 24.7 million tons, due mainly to competition from alternative
crops. The production drop is driven by the United States, but
the 2008/09 crops are also expected to be smaller in Turkey,
Brazil and Egypt. Cotton production is projected to increase in
India, Pakistan and Australia.
Due to declining mill use, world cotton imports are now forecast
to decline by 6% in 2008/09, to 7.8 million tons. Imports by
China (Mainland) are expected to decrease by 10% to 2.3 million
tons.
The ICAC Price Model 2007 forecasts the 2008/09 season-average
Cotlook A Index at 73 cents per pound. However, the Secretariat
believes that the 2008/09 season-average Cotlook A Index may
actually be in the lower half of the 95% confidence interval,
between 64 and 73 cents per pound.
WORLD COTTON SUPPLY AND DISTRIBUTION
|
. |
2006/07 |
2007/08 |
2008/09 |
2006/07 |
2007/08 |
2008/09 |
|
. |
Million Tons |
Million Bales |
|
Production |
26.64 |
26.24 |
24.7 |
122.3 |
120.5 |
114 |
|
Consumption |
26.49 |
26.38 |
25.5 |
121.7 |
121.1 |
117 |
|
Exports |
8.12 |
8.34 |
7.8 |
37.3 |
38.3 |
36 |
|
Ending Stocks |
12.52 |
12.22 |
11.5 |
57.5 |
56.1 |
53 |
|
Cotlook A Index* |
59.15 |
72.90 |
73** |
59.15 |
72.90 |
73** |
|
* Season-average Cotlook A Index
(U.S. cents per pound).
** The price projection for 2008/09 is based on the ending
stocks/consumption ratio in the world-less-China (Mainland) in
2006/07, in 2007/08 (estimate), and in 2008/09 (projection), and
on the ending stocks/consumption ratio in China (Mainland) in
2006/07 and in 2007/08 (estimate). 95% confidence
interval: 64 to 83 cents per pound.
The International Cotton
Advisory Committee is an association of 41 governments of
cotton producing and consuming countries. The Secretariat of the
Committee publishes information related to world cotton
production, supply, demand and prices, and provides technical
information on cotton production technology |
|
