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World
and U.S. Cotton Situation and Outlook |
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Marketing
Years 2002/03, 2003/04 and 2004/2005 |
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1,000
480-Lb. Bales |
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World |
U.S. |
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2002/03 |
2003/04 |
2004/05 |
%
Change 04/05-03/04 |
2002/03 |
2003/04 |
2004/05 |
%
Change 04/05-03/04 |
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Production |
88,276 |
94,332 |
107,246 |
13.7% |
17,209 |
18,255 |
20,895 |
14.5% |
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Imports |
30,222 |
34,237 |
31,775 |
-7.2% |
67 |
50 |
40 |
-20.0% |
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Use |
98,601 |
98,852 |
100,847 |
2.0% |
7,273 |
6,488 |
6,100 |
-6.0% |
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Exports |
30,358 |
32,967 |
31,523 |
-4.4% |
11,900 |
13,800 |
12,000 |
-11.6% |
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Ending
Stocks |
36,606 |
33,424 |
40,032 |
19.8% |
5,385 |
3,500 |
6,100 |
74.3% |
No changes are made to the U.S. estimates for 2003/04.
U.S. production in 2004/05 is raised 712,000 bales this month to a record 20.9 million bale. A combination of a better than average weather condition, and a reduction in abandoned acres is the primary reason for this increase. Consumption is raised 200,000 bales in MY 2004/05 to reflect additional mill use suggested by the Census Bureau. Exports are raised 200,000 bales in 2004/05 to 12.2 million bales, due to higher U.S. production and slightly higher world demand. Ending stocks are raised 200,000 bales to 6.1 million bales.
No changes are made to the world estimates for 2001/02 or 2002/03.
For MY 2003/04, world production is raised 305,000 bales to 94 million bales, mainly due to a production increase in India. The production for India was raised 300,000 bales because of new data. The world mill use is increased 188,000 bales due to an increase for the United States by the same amount. Imports are increased 203,000 bales with Turkey accounting for most of the increase. The world ending stocks are adjusted 412,000 bales higher bales to reflect higher production and imports.
For MY 2004/05, the forecast for the World production is raised 657,000 bales to a record 107.2 million bale, mainly due to increases in the United States (712,000 bales), India (250,000 bales) and Uzbekistan (200,000 bales), partially offset by reductions for China (500,000 bales) and Australia (100,000 bales). The World mill use is increased 200,000 bales, reflecting an equal increase by the United States. The forecast for trade shows increases for both imports and exports. The increase in exports is a result of increases for the United States (200,000 bales), Uzbekistan (150,000 bales), and India (100,000 bales), which are partially offset by decrease for Australia (200,000 bales) and Brazil (100,000 bales). The increase in imports is a result of increases for China (350,000 bales) and Turkey (150,000 bales), which are partially offset by a decrease for India (200,000 bales). Ending stocks are increased 812,000 bales from last month’s forecast. The increase comes about as a result of higher production and beginning stocks, which are only partially offset by higher consumption.
Highlights of this month:
- China: Production is reduced 500,000 bales, due to lower reported area. With no change in mill use, China is expected to import an additional 350,000 bales of cotton.
- Australia: Production is reduced 100,000 bales, as continued dry conditions reduce prospective irrigation supplies. Additionally, exports are reduced 200,000 bales because of lower than expected available exportable cotton.
- Brazil: Exports are lowered 100,000 bales because of expected changes in export timing during the local marketing year.
- India: Production is increased 250,000 bales due to recent improvements in monsoon season. With mill use unchanged, the additional domestic production will reduce India’s need for cotton imports by 200,000 bales, and increase its export by 100,000 bales.
The A (NE) is a principle measure of international cotton prices. It is calculated as an average of the five lowest quotes of major cotton growths for delivery to Northern European ports. In July, the index averaged 53.56 cents per pound, down 3.46 cents from June's average. In New York, the nearby October futures contract settlement price increased 9.97 cents between the end of July and the end of August, closing at 53.80 cents per pound on August 31.
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U.S. Cotton Consumption and Stocks |
June |
May |
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Seasonally adjusted daily rate of consumption |
24,399 bales |
23,966 bales |
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Total bales consumed per month |
463,023 bales |
605,548 bales |
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Seasonally adjusted annualized consumption rate |
6.368 million bales |
6.255 million bales |
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Active spindles |
2.15 million |
2.17 million |
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% Spindles dedicated to 100% cotton |
57 percent |
57 percent |
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Cotton’s share of total fibers consumed on spindle system |
81.40 percent |
80.64 percent |
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Cotton Stocks at mills |
339,165 bales |
331,848 bales |
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Cotton Stocks in public storage |
2.837 million bales |
4.368 million bales |
Textile Mill Report. Mill buyers purchased a light volume of 2003-crop cotton for prompt through November 2004 delivery. A few mills began inquiring about setting delivery appointments for 2004-crop cotton that was bought for October delivery. Some mills took three to five days off for the Labor Day holiday.
U.S. COTTON EXPORTS totaled $428.6 million or 1.477 million bales in July, increasing from $371.3 million or 1.130 million bales in June, according to Census data. Mexico was the top destination for U.S. cotton in July at 346,000 bales or $97.6 million, followed by Turkey (154,000 bales or $45.6 million), China (143,000 bales or $41.9 million), Indonesia (133,000 bales or $40.0 million), and Pakistan (111,000 bales or $31.1 million). Exports to only China were down from June and have consistently tailed off since March. Exports to Mexico rose by 80 percent over June and, along with Indonesia and Pakistan, have increased each month since April.
U.S. COTTON IMPORTS decreased to $1.5 million (2,500 bales) in July from $3.7 million (6,000 bales) in June. Egypt accounted nearly 90 percent of U.S. cotton imports in July ($1.4 million or 2,200 bales); imports were otherwise sourced from Benin and India.
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