According to the International Cotton Advisory Committee, global cotton consumption in 2016/17 is likely to exceed production for the second consecutive season.
World ending stocks are estimated to have fallen by 13% to 19.5 million tons in 2015/16 as global demand outpaced production. In 2016/17, world cotton consumption is expected to exceed world cotton production by 1.4 million tons, which would bring ending stocks to 18.1 million tons, down 7% from 2015/16. Ending stocks outside of China are forecast to increase by 1% to 8.3 million tons, although the stock-to-use ratio would remain unchanged. However, ending stocks in China are expected to decrease by 13% to 9.9 million tons in 2016/17 as the government continues to dispose of its reserves.
World cotton production is projected to increase by 6% to 22.5 million tons. Better prices for competing crops, the late arrival of the monsoon and yield losses from pest pressure last season discouraged farmers in India, and the planted area is projected to fall by 6% to 11.2 million hectares. The area under cotton in China is projected to contract by 7% to 2.9 million hectares in 2016/17, but the national average yield is expected to improve by 4% to 1,623 kg/ha due to generally favorable weather during the growing season. The cotton area in the U.S. is expected to rebound by 10% to 3.6 million hectares, and the average yield is anticipated to increase by 8% to 929 kg/ha due to beneficial weather and plentiful rainfall.
World cotton consumption is forecast to remain stable at 23.8 million tons. China will likely be the largest consumer in 2016/17 despite an expected decrease in mill use of 3% to 7.1 million tons, which would be the seventh consecutive season of contraction.
Stable demand and larger crops in many of the top exporting countries are expected to lead to an increase in world trade volume of 3% to 7.5 million tons.