WASDE NOVEMBER 9, 2010

World Agricultural Supply and Demand Estimates

United States Department of Agriculture

Agricultural Marketing Service

Economic Research Service Farm Service Agency

Foreign Agricultural Service

Approved by the World Agricultural Outlook Board

November 9, 2010

COTTON: The U.S. 2010/11 cotton supply and demand estimates include lower production, lower domestic mill use, and higher exports relative to last month. Production is lowered 455,000 bales to 18.4 million, as reductions for Texas are partially offset by increases in the Southeast and Delta. Domestic mill use is reduced 150,000 bales to 3.45 million in response to recent sharply higher prices. Exports are raised 250,000 bales to 15.75 million, based on increased foreign demand and extremely strong export sales to date. Ending stocks are reduced 500,000 bales to 2.2 million bales, the lowest since 1925. The forecast range for the marketing year average price received by producers of 74 to 86 cents per pound is raised 7 cents on both ends. The midpoint of the range, if realized, would be the highest price since the Civil War.

The 2010/11 world cotton forecasts show lower consumption and ending stocks compared with last month, stemming from reduced supplies. Beginning stocks are reduced 3.0 million bales in China, asW ASDE-488-5 the 2009/10 balance sheet is revised to reflect the shortages in mill inventories that have become apparent in recent weeks (see http://www.usda.gov/oce/commodity/wasde/index.htm for a detailed explanation). World production is reduced 1.4 million bales, as reductions for China, the United States, Pakistan, Greece, and Turkey are partially offset by increases for Brazil, Australia, and Uzbekistan. With supplies insufficient to meet demand, world consumption of 116.8 million bales is reduced 3 percent from last month and 1.4 percent from last season. Relative to last month, consumption is reduced in China, Bangladesh, Indonesia, Pakistan, Thailand, the United States, Vietnam, Brazil, and Turkey; these reductions are partially offset by an increase for India, where consumptio

 n is expected to benefit from export restrictions. World trade is raised nearly 800,000 bales from last month, as a 2- million bale increase in imports by China is partially offset by lower imports by several other countries. World ending stocks are reduced 5 percent to 42.2 million bales. The world stocks-to-consumption ratios are reduced to 37 and 36 percent, respectively, in 2009/10 and 2010/11, the lowest since 1993/94.