From the Secretariat 

Consumption has been greater than production for the past two seasons. While both consumption and production are experiencing growth since the 2015/16 season, global production is increasing at a faster rate. Current estimates for the season have production at 25.5 million tons and consumption at 25.4 million tons. Production increases are coming off the gains in planted area rather than yields this season. Global average yield for 2017/18 is currently being estimated at 773 kilograms per hectare, a 1% decrease from the previous season with a 12% growth in planted area. India and Pakistan, with estimated area increases of 16% and 24% respectively, encountered production losses from pink bollworm this season.

Northern hemisphere production which accounts for 88% of world production is estimated at 22.5 million tons for the 2017/18 season, an increase of 12% from the 2016/17 season. Production increases are expected in major exporting countries in the southern hemisphere. Global trade is projected at 8.2 million tons this season. Leading importers include Bangladesh and China with an estimated 19% and 16% of global share respectively. East Asia’s volume of imports continues to increase and could represent approximately 36% of global share or 2.95 million tons. The USA will continue to lead all exporters in 2017/18 with 39% of the global share and 3.2 million tons. Australian exports in 2017/18 are projected to continue growing reaching 944,000 tons and accounting for 11.4% of global share. India, despite a lower than expected production is projected to export 935,000 tons representing 11.3% of global exports.

In 2017/18, world ending stocks are estimated at 18.9 million tons, slightly higher than the 18.7 million tons for the previous season. The Cotlook A index during January 2018 averaged 91 cents per pound with a 2017/18 season to date average of 82.4 cents per pound. Competing price of polyester has risen over the course of the season and continues to increase relative to cotton, even as cotton prices have moved upward.

* The price projection for 2017/18 is based on the ending stocks to mill use ratio in the world-less-China in 2015/16 (estimate), in 2016/17 (estimate) and in 2017/18 (projection), on the ratio of Chinese net imports to world imports in 2016/17 (estimate) and 2017/18 (projection), and on the average price for the first 6 months of 2017/18. The price projection is the mid-point of the 95% confidence interval: 71 cts/lb to 85 cts/lb.