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World cotton production is estimated at 19.3 million tons in 1999/2000, 700,000 tons more than last season, but consumption is climbing by only 100,000 tons to an estimated 19.1 million in 1999/2000. Expectations that production will exceed consumption this season, coupled with an increase in exports from China (Mainland), are reflected in the downward trend in international prices. Consequently, the Cotlook A Index, an indicator of international prices, is expected to fluctuate in a range below last year’s average of 59 cents per pound. In early November, the Cotlook A Index was the lowest in 13 years, but prices may move higher during the remainder of the current season. Despite the reduction in the estimates of U.S. cotton production for 1999/2000 due to adverse weather, world cotton production is projected higher than in the beginning of the season. Production may reach 1.75 million tons in Pakistan and Uzbekistan is expected to realize close to 90% of the official government target of 4 million tons of seed cotton. Finally, Brazilian production is estimated at 490,000 tons, mainly due to an increase in planted area.
With the exception of prices in China (Taiwan), polyester prices have declined in most East Asian and European markets during the last twelve months. Polyester prices have dropped by more than 10% in Japan, Italy, Pakistan, Germany and the Republic of Korea and 2% in the USA, relative to average prices in October 1998. Over the same period, the Cotlook A Index dropped more than 20%, increasing the price competitiveness of cotton fiber. Lower cotton prices relative to chemical fiber prices and higher world GDP growth are expected to boost world cotton consumption by 400,000 tons over the next two seasons. Higher consumption is anticipated in East Asian countries, India, Turkey, Mexico and Brazil. However, U.S. mill use is expected to follow a downward trend over the next five years because increases in the amount of textile and apparel imports by the USA are anticipated.
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WORLD COTTON SUPPLY AND DISTRIBUTION |
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1997/98 |
1998/99 |
1999/00 |
1997/98 |
1998/99 |
1999/00 |
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Million Tons |
Million Bales |
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Production |
20.072 |
18.65 |
19.31 |
92.2 |
85.6 |
88.7 |
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Consumption |
19.276 |
19.03 |
19.19 |
88.5 |
87.4 |
81.1 |
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Exports |
5.911 |
5.29 |
5.88 |
27.1 |
24.3 |
27.0 |
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Ending Stocks |
9.916 |
9.70 |
9.82 |
45.5 |
44.6 |
45.1 |
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Cotlook A Index |
72 |
59 |
55* |
72 |
59 |
55* |
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* US cents per pound. Statistical estimates are based on current estimates of supply and use; 95% confidence intervals extend 15 cents per pound above and below each point estimate.
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The International Cotton Advisory Committee is an association of 43 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. Detailed statistics are found bimonthly in COTTON: Review of the World Situation, $150 per year. A monthly outlook by fax is also available for $250 per year or on the Internet for $200 per year. Access to the daily estimates of world cotton supply and use by the Secretariat is also available on the Internet for $1,500 per year.