Historical Revisions to Indian's Cotton Balance Sheet - USDA
Historical Revisions to Indian's Cotton Balance Sheet - USDA
Historical revisions have been made to India’s balance sheet for the years 2002/03 through 2013/14, with the stock adjustment carried forward. The revisions are based on the conclusion that market yard arrivals data underreported arrivals in the early portion of the harvest season. This conclusion was based on observed market activity in November for several years.
While corn remains the major safrinha crop for Brazilian farmers, more cotton acreage is being planted in Mato Grosso this spring, as well.
Over the past two years, cotton planting has increased by nearly one-third for the safrinha in Mato Grosso. The Brazilian Association of Cotton Producers(Abrapa) forecast cotton acreage to grow to 1.4 million hectares (3.46 million acres). Mato Grosso accounts for about 88% of Brazil’s cotton production.
China cotton imports in 2019/20 are expected to surpass the previous year’s robust level, reinforcing its position as the world’s largest importer. The current 2018/19 estimate, boosted this month, is expected to be the largest in 5 years as China supplements domestic supplies amid ongoing auctions of State Reserve stocks. Despite this strong upward trend in imports, U.S. exports to China have weakened as Brazil, Australia, and other countries have expanded both exports and market share.
Cotton Textile exports reached a level of USD 739.17 million in June 2019 marking a decline of (-) 30.4 per cent against the corresponding month of June 2018, wherein exports were valued at USD 1,061.96 million.
In rupee terms, exports during the month of June 2019 reached a level of Rs. 5,132.72 cr. as against Rs. 7,199.39 Cr. in June 2018 marking a decline of (-) 28.7 per cent in rupee terms.
The latest U.S. Department of Agriculture (USDA) estimates indicate that total U.S. cotton textile and apparel trade rose during the first half of 2019, compared with the corresponding 2018 period. U.S. cotton product imports totaled the equivalent of 9.0 million 480-pound bales of raw cotton during January-June 2019—compared with 8.8 million bales for the first 6 months of 2018—while cotton product exports declined slightly to 1.7 million bale-equivalents.
Highlights from the Inaugural Session of the 78th Plenary Meeting:
Consumers today are increasingly demanding information on the origin and history of the products they buy, putting pressure on retailers to provide transparency
Multiple technologies have the potential to provide that traceability, including blockchain and a host of products from private companies
Cotton Inc. Executive Cotton Update - February 2020
Executive Cotton Update - February 2020
Macroeconomic Overview: The Bureau of Economic Analysis estimates that the U.S. economy grew 2.3% in 2019. Forecasts suggest that growth could slow a little in 2020, with many projections falling between 1.9% and 2.1%. For comparison, in 2018, growth was 2.9% and in 2017 growth was 2.4%.
U.S. producers will plant 13 million acres in 2020
U.S. cotton producers intend to plant 13 million cotton acres this spring, down 5.5% from 2019 (based on the U.S. Department of Agriculture’s February 2020 estimate), according to the National Cotton Council’s 39th Annual Early Season Planting Intentions Survey.
Movement in benchmark prices was mixed over the past month.
The NY December futures contract moved lower (to below 60 cents/lb in late July) and then higher (near 65 cents/lb in early August) over the past month. Current values (63 cents/lb) are nearly even with those from one month ago.
Changes in Supply and Demand Estimates (from 17 August 2020)
Limited Cotton Recovery within Pandemic: Production and Stock Levels High, Slow Consumption Growth
Even as the most stringent containment measures begin to be lifted, the opportunity for economic recovery may not relieve current market uncertainty. Countries vary in their ability to flatten the contagion curve and the fiscal space to mitigate the pandemic associated recession.
All international benchmark prices increased over the past month.
The NY December futures contract climbed from 67 to as high as 72 cents/lb near the end of October. More recently, prices eased back to 70 cents/lb. Cotlook’s A Index rose from 73 to 76 cents/lb over the past month.
Procurement operations of seed cotton (Kapas) under MSP are going on smoothly in the States of Punjab, Haryana, Rajasthan, Madhya Pradesh, Maharashtra, Gujarat, Telangana, Andhra Pradesh, Odisha and Karnataka. Till 23.03.2021 a quantity of 91,86,803 cotton bales valuing Rs.26,719.51 Crore has been procured benefitting 18,86,498 farmers.
Production, Consumption and Trade are Expected to Increase in 2021/22
For the current season, the global production estimate for 2020/21 has been reduced to 24.3 million tonnes this month with smaller crop estimates expected for India, Brazil, and the United States. For India, the latest meeting of the Committee on Cotton Production and Consumption (COCPC) reported production for 2020/21 at 6.12 million tonnes. With the country under crisis from a second wave of COVID-19, mill-use has been revised down to 5.15 million tonnes.
Uncertainty and panic over the OMICRON variant caused the cotton market, along with many other commodities, to drop significantly in price over the past 2 weeks.
Cotton set for best week in over 2 – months on strong export sales data
ICE cotton futures rose 3% on Friday and were headed for their best week in more than two months, supported by strong U.S. export numbers and on hopes of an uptick in demand from top consumer China.
• October was month of continuous down trend. NY December future lost about 1300 points during the month. USDA WASDE was bearish. USDA reduced world consumption by 3 million bales so world ending stock was also up by 3 million bales. Recession fear in Europe and America has created downward sentiment.
• US Export sales was poor also some cancellation from China reason for downtrend. But US is well committed to reach USDA export target.
The lack of demand is clearly a problem at the moment and as such the WASDE doesn’t reflect the right set of numbers in its balance sheet. While the supply side is now more or less known, the demand side is overstated by several million bales and will have to be adjusted lower over the coming months, which will have a bearish impact.
• November month started with sharp uptrend during the first week. NY Future closed limit up for the first four days in this month and jumped to 87 cents from 72 cents in just one week. There after remained highly volatility during the month.
The cotton market was somewhat higher Monday, inspired by adverse weather unfolding across the Belt, as well as continued supporters from Friday's acres report.
The cotton market was somewhat higher Monday, inspired by adverse weather unfolding across the Belt, as well as continued supporters from Friday's acres report.
All cotton planted area for 2023 is estimated at 11.3 million acres, down 18 percent from last year. Upland area is estimated at 11.1 million acres, down 18 percent from 2022. American Pima area is estimated at 154,000 acres, down 16 percent from 2022.
Indian Farmers Might Be Holding Their Cotton but Global Production Remains Stable
In this edition of Cotton This Month, we will examine the current situation with delayed cotton arrivals in India and how this may affect the global balance sheets in the 2022/23 season.
Cotlook’s May supply and demand forecasts indicate lower consumption and higher world ending stocks for both 2022/23 and 2023/24
Cotlook’s forecast of global raw cotton output in 2022/23 has been reduced this month, by 69,000 tonnes to 24,852,000 tonnes. Reductions for the African Franc Zone and the United States were partially offset by increases for China and Australia.
Cotton’s Slow Period Continues... But Planting Decisions Are Coming Soon
With the current season coming to a close it is time to start shifting our focus to the next season with high hopes and anticipation. Most of the Northern Hemisphere cotton producing countries have started planting, are preparing for planting, or are thinking about planting. Soil moisture is an essential ingredient for a successful planting operation.
Dec cotton futures gave up 53 points on the week (the very same 53 points it gained last week) finishing at 85.91, with the Dec – Mar spread strengthening a bit to (84). Last week, our models predicted a finish on the week that was to be near-unchanged to higher Vs the previous week’s finish, which proved to be correct. Dec has commenced the new week notably higher.
Cotton prices for the week traded in a high-to-low range of only 190 points. Every attempt to move beyond eighty-two cents was quickly stifled by grower selling while downside support held firm at 80 cents before giving way slightly on Friday closing at 79.83. This was disheartening when at the same time the Dow, S&P 500, and NASDAQ were hitting all-time highs.
All cotton planted area for 2024 is estimated at 10.7 million acres, up 4 percent from last year. Upland area is estimated at 10.5 million acres, up 4 percent from 2023. American Pima area is estimated at 203,000 acres, up 38 percent from 2023.
In this month’s 2024/25 U.S. cotton balance sheet, the only changes are a 100,000-bale reduction in exports to 10.9 million bales and an increase in ending stocks of the same amount to 5.0 million bales. The projected 2024/25 season average upland farm price is unchanged at 63 cents per pound.
The forecast for 2025/26 U.S. cotton shows a small increase in production, higher exports,beginning and ending stocks, and unchanged consumption compared to 2024/25. Planted area is expected to be 9.87 million acres based on the March 31 Prospective Plantings report. With recent precipitation in the Southwest, abandonment is projected to be lower than average resulting in a U.S. harvested area of 8.37 million acres, higher than the 7.81 million harvested in 2024/25.
COTTON: The 2025/26 U.S. cotton balance sheet is revised to show lower production, beginning stocks and ending stocks, with consumption, imports, and exports unchanged from last month. Harvested area is lowered 2 percent to 8.19 million acres following extensive rainfall and delayed planting in the Delta. The national average yield for 2025/26 is reduced more than 1 percent from last month to 820 pounds per harvested acre, also because of the conditions in the Delta.
COTTON: The July U.S. cotton balance sheet for 2025/26 shows higher production and ending stocks, lower beginning stocks, and unchanged consumption and imports compared to last month. Planted area is raised to 10.12 million acres based on the NASS June Acreage report. Harvested area is increased 6 percent to 8.66 million acres, reflecting higher planted area along with lower abandonment in the Southwest that is partially offset by higher abandonment in the Southeast.
The 2025/26 U.S. cotton balance sheet for August reflects lower production, exports,nd beginning and ending stocks, along with unchanged consumption and imports compared to last month. Planted area is lowered 8 percent to 9.3 million acres based on the NASS August Crop Production report. Harvested area is reduced 15 percent to 7.4 million acres as dryness in the Southwest raises the expected national abandonment rate from 14 percent to 21 percent.
Prices Tease, Outlook May Be “Cautiously Improved”
USDA’s August crop production and supply/demand estimates for the 2025 crop should really have not been a shocker — but they apparently were to some. U.S. acreage and estimated production were reduced sharply from the July estimates. Prices have not been pushed higher by the numbers (not yet), but a smaller U.S. crop could nevertheless be the beginning of an improved outlook. But this may take more time. These numbers will continue to be revised.
• This week begins with a bullish macro tone, as investors place nearly 90% odds on a Fed rate cut at the September 16 and 17 meeting. Commodities are drawing support from stronger demand for hard assets and a softer dollar outlook, while cotton markets will be watching how trade developments and export sales respond. The key test comes Friday with U.S. nonfarm payrolls, where weak jobs data could solidify expectations for a cut and lift agriculture futures.
Cotton Market Bears Continue to Fend Off Bullish Moves
Cotton found a bit of good fundamental news on the week, but prices failed to respond.
U.S. net weekly exports sales jumped ahead of the pace established over the prior year’s trading but failed to impress the market as prices settled the week at 66.03, basis the December contract, and down 51 points on the week.
• This week begins with a mixed macro tone, as markets balance last week’s weak jobs report against optimism for a Fed rate cut on September 16–17. A softer dollar outlook and Fed-driven momentum could continue to provide support for commodities. The spotlight is on Thursday’s CPI report, the final key release before the Fed meets. A cooler print likely cements cut expectations, while a hotter reading could raise stagflation concerns.
The September outlook for 2025/26 U.S. cotton supply and demand shows marginally higher production compared to last month, with no change to exports, consumption, imports, or stocks. The U.S. crop is projected 10,000 bales higher to 13.2 million bales, reflecting unchanged to slightly higher planted and harvested area in all regions. The national average yield is lowered 1 pound to 861 pounds per harvested acre.
What Cotton’s Situation Means for Southwest Georgia
This article was written for and published by Bainbridge Media, “Cotton in Crisis”, The Post-Searchlight — Down on the Farm, Bainbridge, GA, and for Don Shurley’s Cotton Marketing News. It is reprinted with permission.
Maybe you haven’t thought much about it but look around. You’ll see less cotton planted this year than in the past. Places where you typically have seen cotton, you’ll likely now see more peanuts or corn.
Neutral Report Supports Current Cotton Trading Activity
The market was friendly to cotton on the week as December settled 80 points higher at 66.83 cents. The nearby October contract, although thinly traded, also settled 80 points higher at 65.19.
• Markets are optimistic heading into Wednesday’s Fed meeting, where a 25 basis point rate cut is widely expected and would mark the first in nine months. Investors will also be watching U.S.–China trade talks this week alongside Tuesday’s retail sales report, both of which could shape sentiment around growth and demand. Chair Powell’s press conference will be key for signals on inflation, labor market weakness, and tariffs.
