World cotton demand will rise by 3 percent in 2007/08 to 27.4 million tonnes, a slower growth rate than in the previous three seasons due to factors that include higher cotton prices, an international farm group said on Monday.
"The main reasons for this projected slowdown in consumption growth include a decline in the rate of global economic growth, an increase in international cotton prices, and the fact that cotton has lost some of its price competitiveness vis-a-vis polyester in major markets since August 2007," the International Cotton Advisory Committee secretariat said in a monthly report. Global cotton output also will decline in 2007/08 to 26 million tonnes, down 3 percent, due to a drop in harvest area.
ICAC said production cuts are forecast in the CFA Zone in Africa, China, Pakistan, Turkey and the United States. India will be the only major country to boost output with production at a record 5.3 million tonnes.
World cotton imports are forecast to rise 9 percent in 2007/08 to 9.0 million tonnes as a result of higher Chinese imports. ICAC said global cotton prices were estimated at 67 cents per lb in 2007/08 from 59.15 cents a year ago.
"This projected price increase is the result of an expected significant decline in the stocks-to-mill use ratio in the World-less-China (Mainland) in 2007/08," the group said.
INDIA 2007/08 COTTON CROP 23.9M BALES: India's cotton crop in 2007/08 will be 23.9 million (480-lb) bales, up from 21.86 million bales a year earlier, a US Agriculture Department attache in New Delhi said on Tuesday.
In September, the attache forecast India's cotton crop in 2007/08 at 23.5 million bales. "Most cotton growing areas received good rains during September, which has improved yield prospects in the rainfed central and southern states," the attache said.
Consumption was revised lower to 19 million bales on poor export demand for cotton textiles from 20.4 million bales forecast in September, but up from 18.2 million bales in 2006/07.
Exports in 2007/08 were increased to 5.1 million bales from 3.9 million forecast in the prior report. "Comparatively strong international cotton prices have raised export prospects for Indian cotton," the report said. "Market sources report that Indian cotton is currently amongst the cheapest cotton vis-a-vis comparable cotton from other origins."
The Post MY 2007/08 cotton production forecast is raised marginally higher to a record 23.9 million bales based on the latest cotton market arrivals and crop condition reports in the major cotton growing states.