Cotton‘s perspective until 2021-22

Cotton‘s perspective until 2021-22

The U.S. Department of Agriculture has made some projections on cotton trade for the decade up to 2021-22 entailing agricultural commodities and trade as well as aggregated indicators of the sector such as farm income and food prices. All of this leads to some interesting conclusions

Worldwide cotton trade will increase annually by 1.5 % but it will not exceed the record of 2005. The geographical shifts in mill use and trade of cotton will continue but with no dramatic effect as the one in 2005 with the elimination of MFA Multi Fibre Arrangement Quotas. Asia will increase its share above the 77 % in 2010.

Cotton imports

Apart from China, Bangladesh became the world’s second largest cotton importer and is expected to retain this status also with steady rising imports. Also Pakistan has become a significant cotton importer lately but imports will be slowing because of the enhanced and more efficient cotton growing conditions thanks to specially adapted Bt (genetic) cotton varieties. Turkey’s cotton imports were falling and they are estimated to remain low over the next decade. The EU, Japan and Taiwan as well as South Korea will reduce their cotton imports because of textile reforms or higher wages in these economies and textile production will be outsourced to countries with lower wages and other production costs. The worldwide future cotton imports can be had from Table 1

Projections of Worldwide Cotton Imports up to 2021/22
Season / Mn bales             Total      Share of China
2010/11 35.6 12.0
2011/12 36.3 14.0
2012/13 38.1 16.0
2013/14 38.9 16.5
2014/15 39.0 16.5
2015/16 39.5 16.6
2016/17 40.1 16.7
2017/18 40.7 16.8
2018/19 41.4 17.0
2019/20 42.0 17.3
2020/21 42.9 17.6
2021/22 43.6 17.9
Source: USDA Agricultural Projections for 2012-21 February 2012

 

Cotton exports

The American estimates are based upon globalisation effects pressing to move raw cotton production to countries with favourable resource and technology situations. Benefiting would be the U.S.A., Brazil (plus 1.3 million bales by 2021/22 and by adding production areas) and Sub-Saharan-Africa and West Africa, these 15 states will add 40% and account for 19% of the world trade growth, predominantly because of increasing use of Bt cotton and an improved financial and technical infrastructure. A steady growth is also projected for the Sub Sahara region, but less robust than for West Africa. The significance of technology is reflected in the past rapid adoption of genetically modified cotton in India. America will lead the pack in cotton exports (nearly 15 million bales by 2021/22) and will increase slightly but remains a bit below the recent historical average. Brazil will become the world’s second largest cotton exporter up to 2021/22 and surpassing exports from India and Australia.

The cotton export situation can be had from Table 2

Projections of worldwide cotton exports up to 2021/22
Season / Mn bales             Total      Share of USA
2010/11 35.6 14.4
2011/12 36.3 11.3
2012/13 38.1 12.4
2013/14 38.9 13.8
2014/15 39.0 14.2
2015/16 39.5 14.5
2016/17 40.1 14.6
2017/18 40.7 14.7
2018/19 41.4 14.7
2019/20 42.0 14.7
2020/21 42.8 14.8
2021/22 43.6 14.8
Source: USDA Agricultural Projections for 2012-21 February 2012

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