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China shifts towards imports of cotton yarn

Wednesday, November 6, 2013

Mill use of cotton in China—the world’s largest spinner of raw cotton into yarn—is projected to remain steady at 36 million bales for 2013/14 (August/July), but has declined over the last decade while imports of cotton yarn have increased. With China’s Government maintaining a policy that sets a high domestic floor price for raw cotton, domestic prices remain above world prices, creating an incentive for China’s textile industry to import more lower-priced cotton yarn from the world market. Data for the last three seasons indicate the growth in China’s cotton yarn imports, which reached an equivalent of nearly 8.3 million bales of raw cotton in 2012/13, more than double the level imported in 2010/11. The largest yarn suppliers to China during this period were Pakistan, India, and Vietnam, with the three countries accounting for 72 percent of China’s cotton yarn imports during the past two seasons. Along with China’s shift to more imports of cotton yarn, global raw cotton trade is only expected to reach 39 million bales in 2013/14, 17 percent below the record of 46.7 million bales set in 2012/13, as China’s raw cotton imports fall about 9.3 million bales. This chart can be found in the Cotton and Wool Chart Gallery with analysis in Cotton and Wool Outlook: September 2013.

Global cotton production to exceed consumption for 4th consecutive year

Wednesday, June 19, 2013

Global cotton production is forecast to exceed consumption for the 4th consecutive year in 2013/14, but declining production and rising demand are expected to bring the market into closer balance. In 2013/14, the world cotton crop is forecast to drop 3 percent to 117.8 million bales, with gains in the Southern Hemisphere and South Asia more than offset by declines in the United States and China. Modest growth in world gross domestic product (GDP) is expected to boost cotton consumption in 2013/14, with China, India, and Pakistan forecast to account for a combined 65 percent of world consumption. World cotton trade is forecast to decline 12 percent to 39.5 million bales in 2013/14 because of lower exportable supplies in several countries and, particularly, a 34-percent forecast decline in China’s import demand. World cotton prices are expected to strengthen in 2013/14, but uncertainty about the duration of China’s recent policy of cotton stock accumulation remains a key question in the price outlook. This chart can be found in Cotton and Wool Outlook: May 2013.

Southwest cotton farms produced more cotton and more low-cost cotton than other U.S. cotton farms

Wednesday, April 10, 2013

The Southwest now accounts for the largest regional share of U.S. cotton production, accounting for 47 percent of U.S. cotton production in 2007, up from 25 percent in 2003. In the same period, the production share for Southeast producers fell from 25 percent to 17 percent, and the share for Delta producers fell from 35 percent to 28 percent. The increased production share for Southwest producers reflects low average per-acre production costs, high average per-acre returns for upland cotton production, and the lack of alternative crops compared with other U.S. regions. Although Southwest cotton yields per planted acre were similar to the U.S. average, the region’s relatively low per-acre cotton production costs were largely responsible for high average returns. This chart appears in Characteristics and Production Costs of U.S. Cotton Farms, 2007, EIB-104.

Rising stocks weaken world cotton prices

Friday, March 29, 2013

Despite rising global mill use, 2012/13 world ending stocks are estimated at a record 81.7 million bales, up 18 percent from the previous year, leading to a second consecutive year of lower world cotton prices. Higher global ending stocks are driven largely by China’s stocks purchase policy. China’s 2012/13 ending stocks are estimated at 44.1 million bales, up 46 percent from the previous year, accounting for 54 percent of world ending stocks. The United States is expected to carry 4.2 million bales in 2012/13 ending stocks, up 25 percent from the previous year. Higher stocks in China and the United States more than offset somewhat lower estimated stocks in other key countries, including Australia, Brazil, India, Pakistan, and Turkey. This chart appears in the Cotton and Wool Chart Gallery.

A majority of U.S. cotton textile exports stay within North America

Tuesday, September 25, 2012

Cotton products continue to account for most of U.S. textile and apparel trade, although there have been recent declines as a result of fiber substitution. Through the first 6 months of 2012, U.S. cotton product imports and exports reached 3.8 billion pounds and 962 million pounds, respectively. For U.S. cotton product exports, the top five destinations accounted for a steady share of nearly 85 percent of total exports. Of the top five destinations, only exports to Canada were higher than the comparable period of 2011. The share of total exports was mixed for the top countries. Honduras was the leading destination but its share is declining, falling below 36 percent during the first half of 2012; the share also decreased for the Dominican Republic. For Mexico--the second leading destination--the share rose to nearly 19 percent, similar to calendar year 2010; the shares for El Salvador and Canada continued their trend higher during the first half of 2012. This chart is found in the Cotton and Wool Outlook, CWS-12g, September 2012.

Cotton stocks forecasted to rise in 2012/13

Friday, July 6, 2012

The latest USDA projections for 2012/13 indicate that world cotton stocks are expected to rise for the third consecutive season, reaching a record 74.5 million bales for 2012/13, nearly 11 percent or 7.2 million bales above 2011/12. World cotton stocks have grown as a result of recent record cotton prices that encouraged area increases in 2010 and 2011 that subsequently led to large crops. Meanwhile, higher prices promoted substitution away from cotton by mills, and the slowdown in the global economy reduced demand further, exacerbating the rise in stocks. In China, stocks are projected to expand nearly 20 million bales over a 2-year period because of extensive purchases for its national reserve program, with these stocks likely to be used by Chinese mills as demand rebounds. This chart is found in the Cotton and Wool Outlook, CWS-12d, June 2012.

A majority of cash grain, cotton, and peanut farms are covered by crop insurance

Wednesday, June 20, 2012

Most farms specializing in cash grains, cotton, and peanuts reported farmland covered under a Federal crop insurance policy in the 2009 Agricultural Resource Management Survey. Farms with other specializations participated in Federal crop insurance, but to a lesser degree. About a third of tobacco farms had insured land, as well as 20 to 30 percent of farms specializing in hogs, dairy, or fruits, vegetables, and tree nuts. Hog and dairy farms often grow crops to feed their livestock, and these crops are eligible for Federal crop insurance. This chart is found in Changing Farm Structure and the Distribution of Farm Payments and Federal Crop Insurance, EIB-91, February 2012.

U.S. cotton exports forecast to decline in 2011

Friday, May 25, 2012

U.S. cotton exports are forecast to decrease about 25 percent this season. The drought-reduced U.S. crop lowered exportable supplies and competition from more abundant foreign supplies is expected to reduce shipments to their lowest level in a decade. As a result, the share of global trade is projected to fall to 28.4 percent in 2011/12, 9 percentage points below the 5-year average and the lowest share since 2000/01. This chart is found in the March 2012 Cotton and Wool Outlook, CWS-12a.

Global cotton mill use sees second year of decline

Friday, April 27, 2012

With recent high cotton prices that encouraged fiber substitution and the global economic uncertainty facing consumers, world mill use is projected to decrease to its lowest level since 2003/04. World cotton consumption in 2011/12 is forecast at 107.7 million bales, 6 percent below last season. Consumption is lower in most major cotton consuming countries this season with the notable exception of Pakistan, where cotton mill use is expected to rise 3 percent. Foreign consumption is projected to decline 6.3 million bales in 2011/12, with China accounting for more than half of the decrease. Despite the reduction, China still accounts for nearly 40 percent of the global cotton mill use in 2011/12. The U.S. is expected to contribute 3 percent of the total in 2011/12, compared with 6 percent as recently as 2004/05. The U.S. is expected to contribute 3 percent of the total in 2011/12, compared with 6 percent as recently as 2004/05. This chart is found in the April 2012 Cotton and Wool Outlook, CWS-12b.

All-time high prices mean some farmers can expect large gains for receipts in 2011

Thursday, December 22, 2011

Very large gains in annual receipts are expected for wheat, corn, hay, and cotton in 2011, often reflecting prices that are forecast to exceed their previous records. The U.S. annual wheat price is expected to increase to $7.43 per bushel, a 44 percent increase from 2010 and 8 cents-per-bushel below its 2008 average, reflecting a large increase in wheat exports. The U.S. annual corn price is expected to increase from $3.89 per bushel to $6.04, a large increase over its earlier high of $4.66 in 2008, as corn continues to respond to the increased demand for ethanol. The U.S. annual soybean price is expected to increase from $10.24 per bushel to $12.89 ($10.65 per bushel in 2008) and soybean meal to $339.60 per ton. This chart may be found in Agricultural Income and Finance Outlook, AIS-91, December 2011.

Energy-related expenses vary across crops

Thursday, October 20, 2011

Per-acre operating costs are important for determining producer net returns, which influence farmers' cropping choices. Rice, corn, and cotton have the highest per-acre expenses for energy-related inputs. While rice and cotton have the highest per-acre costs for fuel, lube, and electricity, corn has the highest costs for fertilizer. Energy-related costs for soybean production are relatively low. This chart comes from the ERS report, Impacts of Higher Energy Prices on Agriculture and Rural Economies, ERR-123, August 2011.

2011 ratio of stocks-to-use for total world grains and oilseeds near record low

Friday, September 16, 2011

The ratio of global ending stocks to total use can be a reliable indicator of market prices (the lower the ratio, the tighter the market and the higher the price.) Currently, the stocks-to-use ratios for corn and soybeans are near record lows. The stocks-to-use ratios for wheat and rice suggest reasonably comfortable stock levels, but the shortage of milling-quality wheat has put strong upward pressure on wheat prices. Stock-to-use ratios for cotton, total oilseeds, total coarse grains, and sugar are also low. These low ratios suggest strong worldwide competition among crops for acreage in the 2011 planting season. This chart is found in the September 2011 Amber Waves feature, Why Another Food Commodity Price Spike?

Share of total cotton consumption by major spinners

Thursday, September 1, 2011

The latest (August 2011) USDA estimates for 2011/12 project global cotton consumption at approximately 115.2 million bales. After August reductions in both 2010/11 and 2011/12, cotton consumption for the current season is now forecast to grow about 1 percent after a decline of nearly 4 percent in 2010/11. The top four cotton-spinning countries-China, India, Pakistan, and Turkey-are forecast to account for nearly 72 percent of global cotton consumption in 2011/12, slightly below 2010/11 but equal to the average for the 2007-09 seasons. For China-the leading cotton spinner-the share of global consumption is forecast at 40 percent this season. Meanwhile, India-the second leading spinner-has seen its forecast share rise to 18 percent. This chart is from the Cotton and Wool Outlook, CWS-11f, August 12, 2011.

Cotton yields in Brazil have risen the fastest of major world producers in recent years

Tuesday, June 28, 2011

Brazil and India had similar yields in 1992, both below the United States and the world average. With the adoption of modern, large-scale farming and improved access to inputs-and due to the extremely favorable climate in Brazil's new production regions-Brazil's cotton yields have surged to more than double the world average. This chart is from the ERS report, Brazil's Cotton Industry: Economic Reform and Development, CWS-11D-01, June 2011.

Global cotton trade rises in 2010/11

Wednesday, March 23, 2011

As of March 2011, world cotton exports in 2010/11 are estimated at 38.6 million bales, up 9 percent from the previous year and the second consecutive year of trade rebound. Exports in 2010/11 for Australia (3.0 million bales), Brazil (2.7 million), and the United States (15.75 million) are estimated to increase 42 percent, 36 percent, and 27 percent, respectively, from the preceding year. India and Uzbekistan are estimated to export 4.8 million bales and 3.5 million bales in 2010/11, down 27 percent and 8 percent, respectively, from a year ago. Export increases in several major countries more than offset declines in other exporting countries, resulting in one of the largest cotton trade volumes in recent years. This chart was originally published in Cotton and Wool Outlook, CWS-11a, March 11, 2011.

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