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Rising (cotton) stocks and uncertain demand cloud the outlook for 2019/20
Story Date: 7/2/2019
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Source: INTERNATIONAL COTTON ADVISORY COMMITTEE, 7/1/19
Executive Summary
Highlights from the July edition of Cotton This Month:
• As the 2018/19 season closes, production is projected to be 25.7 million tonnes, with consumption estimated at 26.7 million tonnes.
• Ending stocks for 2018/19 are expected to be 17.8 million tonnes.
• Major producers including the USA, Pakistan and Australia suffered production losses in 2018/19.
• Brazil and Turkey posted gains in 2018/19, with Brazil recording a record crop of 2.7 million tonnes.
• For 2019/20, opportunities for consumption growth will come from emerging countries in Asia and Southeast Asia.
Rising Stocks and Uncertain Demand Cloud the Outlook for 2019/20
If trends hold, consumption will outpace production by 1 million tonnes in 2018/19, with projected totals of 26.7 million tonnes and 25.7 million tonnes, respectively.
Major producers including the USA, Pakistan and Australia suffered production losses due to poor weather conditions and lack of available water, but Turkey and Brazil both posted positive totals in 2018/19, with Brazil setting a record-high production of 2.7 million tonnes.
The 2018/19 projected ending stocks of 17.8 million tonnes are expected to expand to 18.7 million tonnes by the end of next season, with stocks outside of China reaching an all-time high of 10.5 million tonnes. If consumption increases in 2019/20, it likely will come from the emerging economies in Asia and Southeast Asia.
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