Cotton. World Markets and Trade. Mar 2013 March 10, 2013
World Stocks Continue to Climb
According to the USDA 2013/14 outlook, world cotton ending stocks are projected to rise for the fourth consecutive year, to a record 88.5 million bales, despite lower production and higher consumption. USDA also projects the A-index will be about unchanged.
China, as in the previous two seasons, is forecast to hold nearly all the expansion in stocks. Assumed continuation of the China reserve policy would keep nearly half of the world’s stocks off the market and limit supplies to local mills. In the rest of the world, stocks are expected to remain relatively stable.
World trade is projected down 11 percent, but China’s imports are forecast down over 40 percent, as quantities released from the State Reserve are expected to rise. However, growth in spinning outside of China is projected to boost import demand. U.S. exports are forecast to fall nearly 10 percent on reduced production and the lower world import demand.
Global cotton stocks for 2012/13 are essentially unchanged as higher production is offset by increased consumption. Trade was raised, primarily due to a higher import forecast for China. U.S. ending stocks are down on higher exports. The season average farm price is raised to 71.5 cents/pound on continued strong prices.
The U.S. spot price and the A-Index continued upward as China’s reserve policy continues to isolate more supplies from the world market.
2012/13 TRADE OUTLOOK
- United States is boosted 250,000 bales to 12.75 million on recent strong sales and shipments.
- Australia is revised up 100,000 bales to 4.6 million on higher world import demand.
- India jumped 1.0 million bales to 5.5 million on higher world import demand.
- Pakistan is cut 100,000 bales to 400,000 on a smaller crop.
- Turkmenistan is up 100,000 bales to 950,000 on increased production.
- Uzbekistan is raised 100,000 bales to 3.0 million due to a larger crop.
- Bangladesh is up 150,000 bales to 3.7 million on stronger consumption.
- China is raised 1.0 million bales to 15.0 million on a higher concentration of stocks in the national reserve.
- Pakistan is boosted 250,000 bales to 2.75 million on a smaller crop.