World Cotton Production
Cotton production is widely grown in the world. In 2007, 90 countries planted cotton. Pakistan is the forth largest cotton-growing country after China, India, and the United States, which account for a combined 71 percent of world production in 2014/15. The first U.S. Department of Agriculture (USDA) cotton forecast that global cotton production will decline for the third consecutive season in 2014/15 due to the area shift from China and Australia to lower-yielding countries. But the production remains above expectations for consumption. The production of world top ten cotton producing countries are listed as follows.
World Cotton Consumption
Global cotton consumption in 2014/15 is projected at 111.8 million bales, a 2-percent increase from the current season, as mill use continues to expand from 2011/12’s 8-year low. China, India, and Pakistan are the main cotton consumption countries, which are expected to account for 65 percent of world cotton consumption in 2014/15.
China cotton consumption is forecast to increase to 37 million bales in 2014/15, which is the highest in recent 3 years. That is because China’s domestic cotton prices have been above world prices during the last several years, which reduced mill use and increased yarn imports. However, recently China’s policy is likely to encourage cotton mill use as cotton fiber is more competitive within China.
India’s cotton consumption is also likely to increase in 2014/15. India is projected to consume 23.5 million bales of cotton accounting for 21 percent of global cotton consumption. India’s mill use rose 18 percent between 2011/12 and 2013/14, supported by yarn shipments to China. In 2014/15, reduced yarn exporting to China will likely reduce India’s cotton consumption.
Cotton consumption in Pakistan has also grown steadily in recent years, benefitting from yarn exporting to China. Pakistan cotton mill use is forecast to rise about 3 percent to 11.8 million bales in 2014/2015, accounting for 11 percent of world cotton consumption.
The consumption of cotton will also increase in other Asian countries, including Bangladesh, Indonesia, and Thailand. Turkey’s cotton consumption is likely to rise nearly 2 percent to 6.4 million bales in 2014/15.
Cotton Supply and Demand
The supply and the demand will affect the price of cotton. The relatively low cotton supply during 2009 and 2010 led to the cotton prices increase in 2010. With the growing cotton supply, the cotton price reduced from 65.0% in 2010 to 49.3% in 2011. Cotton prices stabilized after 2013 as beginning stocks accumulated and production edged downwards. The following table shows the supply and demand of cotton from 2005 to 2014.
