Global 2012/13 cotton production is estimated at 119.7 million bales, down 4 percent from a year earlier, as this month’s USDA reduction for Brazil’s crop is partially offset by an increase for the United States.

Declining production is largely driven by a market environment that favored the cultivation of competing alternatives.

Global 2012/13 harvested cotton area is estimated at 34.2 million hectares, down 4 percent from the preceding year. Global yield is estimated at 763 kg/hectare.

Brazil’s 2012/13 crop is estimated at 5.8 million bales, a decline of 33 percent from the preceding year and an 8-percent (500,000 bales) reduction from the previous month.

Record soybean and corn prices, disease outbreak, and erratic precipitation are expected to lower the crop in Bahia and Mato Grosso, which together account for over 80 percent of Brazil’s total annual cotton production.

The United States is expected to produce 17.3 million bales in 2012/13, a 2-percent increase from the previous month’s estimate and 11 percent higher than the previous year’s crop.

World cotton consumption and ending stocks up in 2012/13

Global 2012/13 cotton consumption is estimated at 107.4 million bales, an increase of 4 percent from the preceding year.

China —t he world’s leading cotton spinner — is expected to consume 36.0 million bales in 2012/13, down 5 percent from a year ago and the lowest consumption in nearly a decade.

China’s domestic policies have constrained domestic mill use, forcing the textile industry to purchase yarn from foreign markets, with Pakistan, India, and Vietnam the largest suppliers.

However, China’s mill use decline is expected to be more than offset by increases in other cotton consuming countries such as Bangladesh, India, Indonesia, Pakistan, Turkey, and Vietnam.

Bangladesh and India are estimated to consume 3.7 million bales and 22.0 million bales, respectively, up 12 percent and 11 percent from the previous year.

In USDA’s April World Agricultural Supply and Demand Estimates (WASDE) report, India’s 2012/13 mill use estimate was raised by 250,000 bales from the previous month.

Indonesia and Pakistan are expected to consume 2.2 million bales and 11.5 million bales, respectively, in 2012/13, reflecting increases of 16 percent and 15 percent from the preceding year.

Mill use in Turkey and Vietnam is estimated at 6.1 million bales and 2.2 million bales, respectively, up 9 percent and 33 percent from a year ago.

With world production outpacing consumption, global 2012/13 ending stocks are estimated to rise 18 percent to 82.5 million bales.

China is now projected to account for 55 percent (45.6 million bales) of global 2012/13 ending stocks, due to massive purchases for the national reserve.

USDA’s April revision increased China’s ending stocks by 1.5 million bales, up 3 percent from the previous month, due to higher expected imports.

The unprecedented increase in global ending stocks is estimated to raise the world 2012/13 stocks-to-use ratio to 77 percent, 9 percentage points above the previous year.

Despite the recent surge in U.S. and world cotton market prices, rising world stocks are likely to depress the season averages below 2011/12.

 

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