Source: INTERNATIONAL COTTON ADIVISORY COMMITTEE, 12/17/18

Executive Summary
Highlights from the December edition regarding the 2018/19 season:
• Global cotton area projected to hold steady at 33 million hectares
• Global production expected to decrease 2% to 26.1 million tonnes
• By the end of the season, stocks in China could be at their lowest level since 2011/12
• Consumption, which increased to 26.8 million tonnes in 2017/18, is forecast to drop slightly

Global Stocks Expected to Decrease; China’s Reserves at Lowest Levels in Years

For the first time since 2015/16, global cotton production is expected to decrease in 2018/19, after
consecutive increases of 7% and 16% in the two prior seasons. A number of producers are expected to
show increases — including China, Brazil, West Africa, Turkey and Uzbekistan — but it likely won’t be
enough to offset decreases in the United States, India, Australia and Pakistan.

Consumption, which managed to post a 9% increase to 26.8 million tonnes in 2017/18, is forecast to drop
slightly to 26.7 million tonnes in the coming year. The tariffs imposed in the much-publicised trade war
between the USA and China are not expected to influence consumption directly, although they could
affect textile demand if they have a slowing effect on economic growth.

With consumption projected to exceed production in 2018/19, the drawdown of stocks continues.
Globally, stocks are expected to decrease from 18.8 million tonnes to 18.2 million tonnes, due almost
exclusively to big decreases in China’s warehouses. The world outside of China actually will see a minor
gain in stocks, but not enough to offset the declines in China, where the projected total of 7.6 million
tonnes would represent the country’s lowest levels since 2011/12.