Farmers are expected to plant fewer acres not only in the United States, but in the rest of the cotton-producing world in 2009-10, economists with the International Cotton Advisory Committee said.
In its monthly forecast, the ICAC said world cotton production will decline about 3 percent to 74.35 million acres. That would be the third straight season of decline since 2007-08 when world acreage reached 77.43 million.
“Decreasing cotton returns, more attractive prices for competing crops, and expected difficulties in financing inputs are encouraging farmers to continue switching to alternative crops,” it said. “World cotton area is forecast down by 3 percent to 30.1 million hectares in 2009/10. World cotton production is expected to decrease by 1 percent to 23.5 million tons (108 million bales).”
USDA is predicting producers will plant a million fewer acres of cotton in the United States – from 9.5 million in 2008-09 to 8.5 million in 2009-10 – due to higher input costs and relatively low prices received for cotton.
World cotton mill use is expected to remain almost stable in 2009-10 at 110 million bales. World cotton imports are forecast to rebound by 1 million bales in 2009-10 to 34 million bales, helped by the expected small recovery in mill use in China. World cotton stocks are projected down by 3 percent to 55 million bales in 2009-10.
The ICAC Price Model 2007 projects the season-average Cotton Outlook A Index at 60 cents per pound in 2008-09, down by 18 percent from last season. The 95 percent confidence interval ranges from 56 to 65 cents per pound. The Secretariat's projected 2008-09 season-average Cotton Outlook A Index has declined every month since September 2008, due to a worsening consumption outlook.
The International Cotton Advisory Committee is an association of governments of cotton producing and consuming countries.