Executive Summary
Highlights from the January edition of Cotton This Month regarding the 2018/19 season:
- The midpoint for the 2018/19 price forecast is 86.45 cents/lb, down from last month’s forecast of 89 cents
- The price forecast has a range from 75.60 cents to 100.21 cents
- The projection reflects a 95% confidence interval
- The forecast is based various assumptions, including global consumption, ending stocks, and world trade
ICAC Revises Its Price Forecast to 86.45 cents
With a confidence interval of 95%, the Secretariat of the International Cotton Advisory Committee (ICAC) has set its 2018/19 price forecast for cotton fibre at 86.45 cents per pound, down from 89 cents in December 2018.
The forecast, which has a price range from a low of 75.60 cents to a high of 100.21 cents, is based on the following assumptions:
- World cotton consumption will be 26.7 million tonnes.
- World cotton ending stocks will be 18.2 million tonnes.
- World trade will be 9.4 million tonnes.
- China’s cotton consumption will be 8.45 million tonnes.
- Ending stocks in China will be 7.66 million tonnes, and
- China’s cotton imports will total 1.6 million tonnes.
World Cotton Supply and Demand
| 2016/17 | 2017/18 | 2018/19 | ||||||
| Million Tonnes | Change/Month | Million Tonnes | Change/Month | Million Tonnes | Change/Month | |||
| Beginning Stocks | 20.33 | 0.00 | 18.81 | 0.00 | 18.76 | 0.00 | ||
| Production | 23.08 | 0.00 | 26.75 | 0.00 | 26.16 | 0.04 | ||
| Supply | 43.41 | 0.00 | 45.57 | 0.00 | 44.92 | 0.04 | ||
| Consumption | 24.50 | 0.00 | 26.81 | 0.00 | 26.70 | -0.02 | ||
| Exports | 8.18 | 0.00 | 9.00 | 0.00 | 9.42 | 0.00 | ||
| Ending Stocks | 18.81 | 0.00 | 18.76 | 0.00 | 18.21 | 0.05 | ||
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ICAC Price Projections |
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| Season-average Cotlook A Index (US cents per pound) | ||||||||
| Projections | Previous Month | This Month | ||||||
| Range | Midpoint | Range | Midpoint | |||||
| 2018/19* | 74-107 | 89 | 76-100 | 86 | ||||
| *The price projection for 2018/19 is based on the ending stocks-to-mill use ratio in the world-less-China in 2016/17 (estimate), in 2017/18 (estimate) and in 2018/19 (projection), on the ratio of Chinese net imports to world imports in 2017/18 (estimate) and 2018/19 (projection), and the average price of 2017/18. Projection reflects 95% confidence interval. | ||||||||