World Cotton Trade in 2014/15 Is Forecast to Reach Only 36.3 Million Bales

World cotton trade in 2014/15 is forecast to reach only 36.3 million bales, 10 percent below the previous season and the lowest since 2010/11. While imports by China have supported cotton trade over the last several seasons, expectations for lower China import demand are reducing trade in 2014/15.

The initial forecast represents the second consecutive decrease in global trade as most major exporters anticipate reduced shipments in 2014/15. Exports by the United States, the world’s leading exporter, are forecast to decline 7 percent to 9.7 million bales, the lowest since 2000/01. Exports from India and Australia are forecast to decline considerably from a year earlier as exportable supplies there appear limited.

India is projected to export 5.7 million bales in 2014/15, down 35 percent from 2013/14.In Australia, exports are projected at 3.2 million bales, down 30 percent from a year earlier and the lowest since 2010/11. Brazil’s exports are forecast to rebound to 3.5 million bales with increased supplies. Uzbekistan’s exports are projected to remain flat in 2014/15 at 2.7 million bales.

Global imports in 2014/15 are driven once again by China, where cotton imports are forecast to fall by one-third to 8.5 million bales, as the Government is likely to restrict imports in favor of consumption of domestic cotton. Imports by China are expected to decline for the third consecutive season after reaching a record 24.5 million bales in 2011/12. Smaller import declines are also expected for Turkey, Vietnam, Malaysia, and others in 2014/15. Offsetting these declines, however, are increases in Pakistan, India, and Bangladesh.

With global cotton production forecast to exceed consumption for the fifth consecutive season in 2014/15, world ending stocks are estimated to rise to a new record, reaching 101.7 million bales by July 31, 2015. China will continue to hold the bulk of these stocks, as ending stocks there are projected to reach 60.5 million bales by the end of 2014/15; however, China’s share of total world stocks is expected to decline slightly.

World stocks outside of China are expected to rise by about 3 million bales. China would hold nearly 60 percent of global cotton stocks, slightly below the estimate for 2013/14. Stocks in India, the next largest stock holder, are also expected to rise to 10.7 million bales, or nearly 11 percent of the global total. The global stocks-to-use ratio is projected at 91 percent, up from 90 percent in 2013/14 and more than double the 2010/11 level.