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Cotton: World Markets and Trade
July 1998
Cotton: 1998/99 Outlook for US and World
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The U.S. outlook for 1998/99 is for lower production, mill use
and exports. The July estimate for 1998/99 U.S. production is 15
million bales, a 20-percent reduction from the current marketing
year. The upcoming crop is plagued with reduced acreage,
increased abandonment and adverse weather conditions in
California, Texas and the Southeast. The decreased production is
expected to significantly reduce U.S. cotton supplies, leading to
a year-to-year reduction in cotton consumption (4 percent) and
exports (33 percent). Lower world consumption and the expected
termination of Step 2 payments are also major factors affecting
the 1998/99 export forecast, currently at 5 million bales.
Reduced exports from the United States are expected to open the
international cotton market to other suppliers. Although
traditional US cotton competitors are expected to have adequate
supplies to provide the international market, China's emergence
as a one-million-bale net exporter is expected to prevent other
competitors from increasing market share. China's expanded trade
is also expected to force foreign countries outside China to hold
stocks, while the United States should be minimally affected
because of reduced domestic cotton supplies.
For more information, contact the author, JonAnn Fleming.
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