WASDE Cotton: Lower Domestic Production, Stocks, Higher Prices

    Gin employee finishing out ginned bales of cotton. ©Debra L Ferguson Stock Images

    The 2021/22 U.S. cotton supply and demand estimates show lower production, lower ending stocks, and a higher price compared with last month. Production is lowered 3 percent, to 18.0 million bales as projected yields in Texas are reduced.

    With domestic mill use and exports unchanged, ending stocks are 500,000 bales lower. At 3.2 million bales, U.S. ending stocks in 2021/22 are projected at 18 percent of use, compared with 17 percent in 2020/21.

    The 2021/22 season-average farm price for upland cotton is forecast at a record-high 90.0 cents per pound, 6 cents higher than last month and nearly 2 percent above the previous record of 88.3 cents in 2011/12.

    The global cotton 2021/22 balance sheet shows lower consumption, higher production, and higher ending stocks compared with last month. During the first weeks of October 2021, world cotton prices have averaged over 115 cents per pound, up at least 40 percent from both year-earlier and long-run levels.

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    While world income growth and spending on goods are expected to remain high during 2021/22, projected annual world cotton consumption growth is now 2.9 percent, compared with 3.8 percent in September.

    China’s consumption is reduced 1 million bales as, in addition to high prices, lagging energy production there cuts into industrial capacity. Consumption is also lower this month in Vietnam, but higher in Pakistan and Turkey.

    World production is 700,000 million bales higher, largely due to an increase in Pakistan. Production is also higher in Turkey, but lower in India as well as the United States.

    World ending stocks in 2021/22 are projected 450,000 bales higher than in September, but 3.2 million bales below 2020/21.

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