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Production in India in CY 2024-25 is projected to be up by 1 million bales to 25 million bales on higher yields.
Global consumption in CY 2024-25 is projected to be up by over 500,000 bales to 115.8 million bales as higher use in India, Pakistan and Vietnam will more than offset a reduction in China.
Global cotton trade is projected to up slightly to 42.3 million bales. Upward adjustments to exports in Brazil and Benin will more than offset downward revisions to Burkina Faso’s and Mali’s exports.
China cotton imports for the period are projected to reduce by 500,000 bales, while Pakistan’s imports were raised by the same amount.
Global ending cotton stocks are forecast to be up by nearly 300,000 bales on higher Argentina and US production and Pakistan imports.
The US season-average farm price for CY 2024-25 remains at 66 cents per pound. US exports during the period are forecast to be down by over 400,000 bales from the previous CY to 11.3 million despite higher supplies.
US cotton shipments are projected at a nine-year low in CY-2024-25, mostly due to Brazil’s more competitive prices and China’s significant drop in demand.
While US production has trended downward recently, Brazil’s CY 2024-25 crop is estimated at 16.9 million bales, surpassing the previous year’s record by 16 per cent. The incredible growth in supply and a significantly depreciated currency has lowered relative Brazilian prices with recently quoted basis levels around 800 points, compared with US origin at over 1,200 points.
Falling global demand is also a factor in lower projected US shipments. CY 2024-25 world imports are forecast to be down by more than 2 million bales from the previous CY due to a significant drop in Chinese demand.
China is still projected as the world’s largest importer at 8.5 million bales, but volume is expected to fall by more than 40 per cent from the previous CY, primarily due to less demand for government reserves. Between August and November this year, US cotton sales and shipments to China are less than a quarter of last year’s level at around 700,000 bales and the lowest level in nine years, the report said.
The uncertain political environment has further stalled forward buying from Chinese buyers for US cotton, giving Brazil a further edge in addition to its competitive prices, it noted.
US cotton spot prices are once again mostly unchanged at around 65 cents per pound compared with last month.
China spot prices are down by 2 cents to 95 cents per pound. China consumption and imports are lowered 500,000 bales this month to 37.5 million.
India spot prices are down slightly to around 81 cents per pound. Brazil prices are down by more than 2 cents to around 68 cents per pound. Pakistan prices are down by 3 cents to roughly 76 cents per pound.
Fibre2Fashion News Desk (DS)