Consumption exceeding production in the global cotton industry for second consecutive year

Prior to the 2015/16 marketing year, global cotton production had exceeded consumption for 4 consecutive years. This led to increasing ending stocks and downward pressure on cotton prices. In addition to the negative production incentives from low prices and excess stocks, poor weather conditions further reduced global cotton production in 2015/16. Consumption exceeded production in 2015/16 by 15 million bales and falling prices stabilized. In 2016/17, projected production has remained below consumption and prices have increased. The global cotton industry also continues to face price competition from synthetic fibers to maintain market share. Consumption is only projected to grow by 1 percent in 2016/17 and is up only 4 percent over a 5-year period. This chart is drawn from the ERS Cotton and Wool Outlook tables released in February 2017.