U.S. Cotton Outlook

The MY 2002/03 U.S. production forecast was lowered 255,000 bales this month, as weather problems in the Southeast more than offset higher forecasts in other regions. The domestic use forecast is down 200,000 bales from last month as recovery in the textile sector stalls. The U.S. export forecast was reduced nearly 2 percent, primarily because export sales thus far in the marketing year have been slower than expected. These changes coupled with lower beginning stocks resulted in no change to the U.S. ending stocks forecast of 6.8 million. 

MY 2001/02 U.S. ending stocks estimate was reconciled with the final Census Bureau data for ending stocks. Ending stocks were lowered 174,000 bales to 7,426,000 bales and loss was increased by 174,000 bales.

World Cotton Outlook

World totals for MY 2002/03 reflect slightly higher beginning stocks and lower production relative to last month. Forecast world production is decreased by 365,000 bales, as reductions in Pakistan (400,000 bales), the United States (255,000 bales), Uzbekistan and Greece (200,000 bales each), Turkmenistan (150,000 bales), Brazil and Cote d'Ivoire (100,000 bales each) and others more than offset a 1.0 million bale increase in China. Consumption is decreased 190,000 bales as decreases in the United States, Egypt, Indonesia, Uzbekistan and others more than offset a 500,000-bale increase in China. An increase in imports of 200,000 bales for Pakistan was more than offset when import forecasts were lowered 150,000 bales for both Indonesia and Turkey. Lower export forecasts for the United States, Greece, Turkmenistan, and Cote d'Ivoire were only partially offset by increases in Tajikistan and Australia. This month's world ending stocks forecast is up marginally.

The world total production estimate for MY 2001/02 is slightly higher this month, reflecting an upward revision for Brazil offset partially by a decrease in Tanzania. World consumption was lowered by 195,000 bales, primarily due to a decrease in Egypt. Trade was mostly unchanged and ending stocks were increased by 156,000 bales.

Cotton Prices

The A-Index, a principal measure of international cotton prices, is an average of the five lowest quotes of cotton for delivery to Northern European ports. In October, the index averaged 49.56 cents per pound, up 0.53 cents from the previous month. Syria had the lowest average quote in September at 49.11 cents per pound. The Memphis quote averaged 51.60 cents per pound, up 2.80 cents from the previous month. In New York, the average daily settlement price of the nearby futures contract was 42.08 cents per pound in October, down from 42.39 cents in September.

U.S. Cotton Highlights

COTTON CONSUMPTION: The seasonally adjusted daily rate of U.S. cotton consumption in September 2002 was 28,572 (480-lb.) bales, up from 28,274 in August. A total of 746,394 bales were consumed during the four weeks of September, compared with 594,533 during the four weeks of August. The seasonally adjusted annualized consumption rate for the month of September was 7.457 million bales, up from 7.380 million in August.

TEXTILE MILL REPORT: Domestic mills showed interest in higher white grades of 2001-crop. Demand was still light for 2002-crop. Ring-spun yarn saw light to moderate demand; open-end yarn saw moderate to good demand. There are concerns about the quality of the U.S. 2002 crop.

COTTON STOCKS: U.S. cotton stocks on hand in consuming establishments at the end of September were 519,248 bales (480-lb), up from 507,138 in August. Stocks held in public storage and compresses in September totaled 5.91 million bales, down from 6.02 million in August. Active spindles in September totaled 2.71 million, of which 1.58 million were dedicated to 100-percent cotton, compared with 3.3 million for the same time last year, with 1.91 million dedicated to 100-percent cotton. Cotton's share on the cotton spindle system in September was 81.4 percent.

U.S. COTTON EXPORTS in August 2002 totaled 649,560 (480-lb) bales, essentially unchanged from 650,167 bales in July 2002, according to the U.S. Bureau of the Census. Mexico, Indonesia and Turkey were the major destinations in August.

U.S. COTTON IMPORTS in August 2002 totaled 2,949 (480-lb) bales, up from 907 bales in July. Of that, 1,681 bales were imported from Australia, the rest from Egypt.

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Last modified: Tuesday, August 30, 2005