U.S. 2018-19 cotton production prospects show a 7% decline to 19.5 million bales. Exports forecast even with the 500,000-bale upward revision to 15.5 million for 2017-18. World stocks outside China expected to grow to a record 50.33 million bales, up 6.5%.

Cotton futures closed lower in most contracts Thursday, with July finishing on the largest loss on a five-session low settlement following a mixed batch of USDA supply-demand estimates.

July lost 130 points to settle at 84.56 cents, in the lower quarter of its 212-point range from up 31 points at 86.17 to down 181 points at 84.05 cents. December settled down 45 points to 80.11 cents, just below the midpoint of its 119-point range from up 19 points at 80.75 to down 100 points at 79.56 cents.

Volume increased to an electronically estimated 35,000 lots from 21,849 lots the previous session when spreads accounted for 8,658 lots or 40%, EFS 415 lots and EFP 379 lots.

U.S. cotton production prospects show a 1.42-million bale or 7% reduction from 2017-18, with exports even with an upwardly revised 15.5 million bales and ending stocks up 500,000 bales to 5.2 million, according to USDA’s first official new-crop estimates. The old-crop carryout estimate was revised down 600,000 bales to 4.7 million.

Production of 19.5 million bales is based on 13.47 million planted acres, up 860,000 acres from last year, as indicated in the March prospective plantings report. Harvested area is projected at 11.13 million acres, an abandonment of 2.34 million acres or 17.4%, and yields at 841 pounds, down from a final 905-pound record high for the 2017 crop.

The USDA based the harvested area on the 10-year average abandonment and yields on a five-year average, both by region. While planted area is expected higher in 2018-19, reduced precipitation thus far in the Southwest suggests abandonment likely will rise from last year’s below-average level, USDA said.

Domestic mill use is projected at 3.4 million bales, up slightly from 3.35 million. Ending stocks are forecast at 27.5% of total use, up from 24.9% in 2017-18 and 15.1% in 2016-17. The average marketing year price at the farm level is forecast from 55 to 75 cents, with the midpoint of 65 cents down from an estimated 68 cents this season.

The revision to 15.5 million bales in 2017-18 exports remains below the estimates of some cotton analysts ranging up to 16 million bales and beyond. The marginal reduction from last month to 20.92 million bales in final 2017-18 production is in line with most trade estimates.

Globally, USDA’s first detailed 2018-19 forecasts show a decline in ending stocks of 4.46 million bales to 83.75 million as consumption again exceeds production. Stocks are forecast at 66.8% of world consumption, down from 73.1% in 2017-18.

World production is expected to fall marginally to 121.19 million bales as the cotton area declines 1%. Expected production in India, the world’s largest producer, at 28.5 million bales is unchanged from 2017-18. Lower production in the United States, Australia and China is nearly offset by higher crops in Pakistan, Turkey and Brazil.

Global consumption is projected up 3.9% to a new record high of 125.44 million bales as a growing world economy drives mill use higher around the world. Projected world exports are up 4.4% to 41.12 million bales. With significantly higher exportable supplies, Brazil, West Africa and Australia are expected to capture a majority of the increase.

World stocks outside China are expected to grow for the third year in a row to 50.33 million bales, up 3.09 million bales or 6.5%. Ending stocks are forecast to rise in nearly all major producing and consuming countries. In contrast, China’s ending stocks are forecast to fall for the fourth consecutive year to less than half the level of 2014-15.

Certified stocks in deliverable position grew 1,261 bales to 74,260. Open interest dipped 67 lots to 286,334 on Wednesday, with July’s down 1,074 bales to 141,059 and December’s up 767 lots to 114,891.