Demand for cotton around the world is expected to continue to exceed supply, buffering prices above recent averages and indicating they will stay somewhat inflated.
World cotton production is estimated at 22.9 million tons for the 2016-17 crop year, while world mill use is projected at 24.3 million tons, which represents the second consecutive season where mill use has exceeded production.
As a result, world ending stocks are forecast to decrease 7 percent to 17.3 million tons. However, this decline occurs entirely within China, where stocks at the end of July are projected to be down 17 percent to 9.2 million tons, according to a new report from the International Cotton Advisory Council. Stocks held outside of China, however, are forecast to rise 6 percent to 8 million tons.
Read more at Sourcing Journal.