Global cotton mill use is expected to increase by 3% in 2007/08 to 27.4 million tons. This rate of growth would be smaller than in the previous three seasons but would remain higher than the long-term average of 2%.
The main reasons for this projected slow-down in consumption growth include a decline in the rate of global economic growth, an increase in international cotton prices, and the fact that cotton has lost some of its price competitiveness vis-à-vis polyester in major markets since August 2007.
World cotton production is estimated down by 3% to 26.0 million tons in 2007/08 due to a decline in area. Production is forecast down in China (Mainland), in the United States, in Pakistan, in Turkey and in the CFA zone. India is the only major producing country where production is expected to increase this season, to a record of 5.3 million tons.
As global cotton mill use is forecast to exceed global production in 2007/08, stocks are expected to decline by 10% to 11.8 million tons by July 2008. World cotton imports are forecast up by 9% in 2007/08 to 9.0 million tons, due to a projected rebound in Chinese imports.
The Secretariat, using the ICAC Price Model 2007, forecasts a season-average Cotlook A Index of 67 cents per pound in 2007/08, 8 cents higher than in 2006/07. This projected price increase is the result of an expected significant decline in the stocks-to-mill use ratio in the World-less-China (Mainland) in 2007/08.
International Cotton Advisory Committee
marketing@alchempro.com
