World cotton consumption may increase

Saturday, October 03, 2009

Post Source: The News International

LAHORE: Cotton consumption by mills around the globe is expected to increase by 2 per cent in 2009-10 due to a slight recovery in the world’s economic growth. Mill consumption is likely to start recovering in the top three cotton consumers — China, India and Pakistan after declines last season. According to a press release issued by the International Cotton Advisory Committee, world cotton production may slightly decline to 23.1 million tons in 2009-10, one per cent lower than in 2008-09. A small drop in cotton area is expected to be partially offset by a thin increase in average yield. Production is expected to increase in India, the US, Pakistan and Australia and decrease in China and Brazil. Cotton plantings in the southern hemisphere will start on a large scale in October. Cotton area in this part of the world is expected to remain stable in 2009-10. Mill usage is also forecast to increase in smaller Asian countries, including Bangladesh and Vietnam, where consumption kept increasing in 2008-09 despite the crisis. However, further declines in mill consumption are expected in a number of countries in Europe, the Americas and East Asia. World cotton imports are projected to go up by 5 per cent to 6.9 million tons. Chinese imports may rise by 8 per cent to 1.6 million tons and imports by Pakistan, Turkey, Bangladesh, Indonesia, Thailand and Vietnam are also expected to increase. US exports are projected to fall by 20 per cent to 2.3 million tons due to increased competition from other countries. Exports from India could rebound to 1.4 million tons. Based on an expected lower stocks-to-mill use ratio in the world, excluding China, the ICAC price model 2007 is likely to hit an average 64 US cents per lb in 2009-10. This will represent a 5 per cent increase from the 2008-09 average.

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