Trends in Cotton Prices: China and the Rest of the World
Trends in Cotton Prices
China and the Rest of the World
In September 2012, international cotton prices declined slightly, whereas Chinese cotton prices increased a little
bit. This might indicate price directions over the next few months. In China, cotton prices in 2012/13 will be
supported by the minimum support price policy, under which the government is organizing daily purchases of
new crop cotton between September 2012 and March 2013. In the rest of the world, the pressure of
accumulating stocks, combined with weak demand, could drive cotton prices down.
In 2011/12, the Chinese government supported both domestic and international prices via significant purchases
of domestic and foreign cotton for the rebuilding of its national reserve. While government support to Chinese
national prices will continue in 2012/13, cotton imports will likely drop sharply. The Secretariat expects China to
import 2.5 million tons this season, less than half the record quantity purchased last season.
With this projected fall in Chinese imports, the outlook in the rest of the world is conducive to lower international
prices in 2012/13. Outside of China, cotton production is forecast down by 6% to 18.6 million tons, while mill use
is expected to increase by 5% to 14.9 million tons. Taking into account reduced shipments to China, stocks in
the rest of the world are expected to grow by 16% to 9 million tons in 2012/13.
China is expected to remain the largest cotton importer in 2012/13. This will prevent international and Chinese
cotton prices from diverging too much. In addition, international cotton prices will eventually receive some
support from the expected lower plantings in the Southern Hemisphere at the end of 2012 and in the Northern
Hemisphere in 2013/14.
WORLD COTTON SUPPLY AND DISTRIBUTION
2010/11 2011/12 2012/13 2010/11 2011/12 2012/13
Million Tons Changes from last Month
Production 25.210 27.282 25.48 0.007 0 0.058 0.29
Consumption 24.517 22.779 23.55 0.000 0.053 0.31
Imports 7.725 9.603 7.58 0.000 0.129 0.25
Exports 7.625 9.716 7.58 0.001 0.342 0.25
Ending Stocks 9.380 13.782 15.72 0.005 -0.190 -0.21
Cotlook A Index* 1.64 1.00 0.84**
* Season-average Cotlook A Index (U.S. $ per pound).
** Average for the first two months of 2012/13.
(Press releases are available via e-mail. For further information, please contact us at Publications@icac.org)
The International Cotton Advisory Committee is an association of governments of cotton producing and consuming countries. The
Secretariat of the Committee publishes information related to world cotton production, supply, demand and prices, and provides technical
information on cotton production technology. Detailed statistics are found bimonthly in COTTON: Review of the World Situation, $185 per
year. A monthly outlook is available on the Internet for $295 per year. Access to the weekly estimates of world cotton supply and use by the
Secretariat is also available on the Internet for $460 per year.