Cotton. World Markets and Trade. Jan 2013 Jan. 12, 2013
Changes in the world outlook for 2012/13 have been driven largely by responses to China’s price support policy, both last year and this year, as reflected in larger beginning and ending stocks. The high Chinese support prices have stimulated production, causing a majority of the crop to be sold to the State Reserve. That has shorted domestic supplies, constrained consumption, and supported imports. With strong Chinese import demand, stocks in the rest of the world have fallen, which in turn, has helped support world prices, but also dampened global consumption.
World Markets and Trade Overview
Global cotton stocks for 2012/13 are raised due to higher production, primarily in China. U.S. ending stocks are down on lower production and higher exports, which were raised on stronger import demand in China. The season average farm price is raised a half cent to 68.5 cents/pound.
2012/13 Trade Outlook
• United States is raised 400,000 bales to 12.2 million on stronger demand from China.
• India is up 500,000 bales to 4.5 million on lower domestic utilization and strong early season shipments.
• Brazil is increased 200,000 bales to 4.4 million on strong early season shipments.
• Australia is revised up 100,000 bales to 4.3 million due to a larger crop.
• China jumped 1.0 million bales to 12.5 million as strong State Reserve purchases raise import demand.
• Vietnam is up 100,000 bales to 2.1 million on greater spinning demand.
Trade Changes 2011/12
• Pakistan is raised 100,000 bales to 1.3 million on revised trade data.
• Pakistan is revised down 100,000 bales to 900,000 on revised trade data.