Cotton Prices Due to Rise
December 15, 2005-- Home Textiles Today,
WASHINGTON, D.C. -- As China continues to absorb much of the world's available cotton supply, cotton prices are poised to climb by as much as 24 percent, to an average level of $0.65 a pound for the cotton year, up from $0.52 a year ago. The International Cotton Advisory Council (ICAC), a consortium of worldwide cotton growers, said that during the first four months of the new cotton year, prices averaged only 55 cents a pound -- suggesting a rapid acceleration in price over the next six to eight months.
"Chinese cotton imports are forecast at a record 3.2 million tons, more than double last year's imports." China, which also will grow an estimated 5.8 million tons this year, will account for about 36 percent of the world's entire supply of cotton, estimated at 25 million tons this year. Global production, the second-highest yield on record, is about five percent less than last season.
The estimated China production is "about nine percent less than last season due to decreased plantings and yields," said ICAC. Production in the U.S. is estimated flat at about five million tons.Production in India is expected to rise about three percent to 4.25 million tons "due to increased planting,” itself “a result of the significant increase in productivity last season." But production in neighboring Pakistan is forecast to fall by 11 percent, "due to decreased yields as weather conditions have been less favorable than last year."
Production in Brazil, Australia and Argentina is expected to decrease sharply, due mainly to the current relatively low price of cotton. Cotton production in the southern hemisphere "could fall to 2.2 million tons this season, 400,000 tons less than last season," the ICAC reported.