COTTON MARKET REPORT - World Trade Organization - … · COTTON MARKET REPORT José Sette Executive Director International Cotton Advisory Committee 5th Dedicated Discussion of the

COTTON MARKET

REPORT

José Sette

Executive Director

International Cotton Advisory Committee

5th Dedicated Discussion

of the Relevant Trade-

related Developments On

Cotton

Geneva

1 July 2016

SUMMARY

1. Introduction

2. Production

3. Trade (Exports & Imports)

4. Consumption

5. Stocks

6. Prices

7. Conclusions

0

20

40

60

80

100

120

0

20

40

60

80

100

120

PRICE (Cotlook A Index)

US cents/lb

WORLD PRODUCTION & MILL USE million tons

Production

Mill Use

0

5

10

15

20

25

30

94/95 99/00 04/05 09/10 14/15

Accumulated surplus 2010/11-

2014/15: 13.6 million tons

12

16

20

24

28

80/81 90/91 00/01 10/11

WORLD PRODUCTION (million tons)

China 20%

India 28%

USA 14%

Pakistan 9%

Brazil 6%

Australia 3%

Uzbekistan 4%

Franc. Africa 5%

Turkey 3% Other

8%

*Forecast

PRODUCTION BY COUNTRY 2016/17*

23m tons

WORLD COTTON AREA AND YIELD million hectares kg/ha

500

550

600

650

700

750

800

850

0

5

10

15

20

25

30

35

40

06/07 08/09 10/11 12/13 14/15 16/17

Area Yield

PRODUCTION million tons

0 1 2 3 4 5 6 7

India

China

USA

Pakistan

Brazil

Uzbekistan

Turkey

Australia

Turkmenistan

Burkina Faso

2015/16 2016/17

SHARE OF TRADE IN WORLD PRODUCTION

0%

20%

40%

60%

80%

100%

0

5

10

15

20

25

30

99/00 04/05 09/10 14/15

Exports Production Share

million tons share of exports

USA 30%

India 14%

Australia 7%

Brazil 11%

CFA Africa 14%

Uzbekistan 7%

ROW 17%

2016/17*

COTTON EXPORTS BY COUNTRY

7.5 million tons

*Forecast

COTTON EXPORTS: 2013/14 TO 2015/16 Five Largest Exporters and Franc. Africa

million tons 0.0 0.5 1.0 1.5 2.0 2.5 3.0

USA

India

Franc. Africa

Brazil

Uzbekistan

Australia14/15

15/16

16/17

WORLD COTTON IMPORTS

6.5 5.4

1.0 4.4

0

2

4

6

8

10

12

00

/01

02

/03

04/0

5

06

/07

08

/09

10

/11

12

/13

14/1

5

16/1

7

World less China China

million tons

-24% 9.8

7.5

CHANGES IN COTTON IMPORTS

2015/16

7.3 million tons

1996/97

6.1 million tons

7 Countries: 34% 7 Countries: 68%

China 13%

Bangladesh 2%

Turkey 5%

Indonesia 7%

Vietnam 1%

Thailand 5%

Pakistan 1%

ROW 66%

China 12%

Bangladesh

12%

Turkey 9%

Indonesia 8%

Vietnam 12%

Thailand 3%

Pakistan 6%

ROW 38%

WORLD COTTON MILL USE

0

5

10

15

20

25

30

90/91 95/96 00/01 05/06 10/11 15/16 20/21

million tons

GROWTH IN WORLD COTTON MILL USE

3.1%

-0.5%

-2.0%

6.0%

2.8% 2.0%

3.1%

1.1%

9.8%

5.9% 6.3%

0.3%

-11.0%

6.6%

-2.8%

-7.4%

3.3%

1.0%

2.4%

-2.8%

-0.12

-0.07

-0.02

0.03

0.08

1.5%

CHANGES IN COTTON MILL USE

2015/16

23.7 million tons

1996/97

19 million tons

7 Countries: 70% 9 Countries: 86%

China 23%

India 15%

Pakistan 8%

USA 13%

Turkey 6%

Brazil 4%

Indonesia 2%

ROW 29% China

30%

India 22%

Pakistan 9%

Turkey 6%

Bangladesh

5%

Vietnam 5%

USA 3%

Brazil 3%

Indonesia 3%

ROW 14%

CHINA MILL USE AND WORLD SHARE US cents/lb

0%

10%

20%

30%

40%

50%

0

2

4

6

8

10

12

90/91 95/96 00/01 05/06 10/11 15/16, for

Consumption Share

0 1 2 3 4 5 6 7 8

China

India

Pakistan

Turkey

Vietnam

Bangladesh14/15

15/16

16/17

COTTON MILL USE

million tons

2016 CHINESE RESERVE SALES thousand tons

11500

11600

11700

11800

11900

12000

12100

12200

12300

12400

12500

0

5

10

15

20

25

30

35

5/3 5/10 5/17 5/24 5/31 6/7 6/15 6/22

Offered Sold Auction Floor Price

yuan/ton

CHINA NATIONAL RESERVE

Aug-11 Aug-12 Aug-13 Aug-14 Aug-15

0

2

4

6

8

10

12

14

million tons

WORLD ENDING STOCKS million tons

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

0

5

10

15

20

06/07 08/09 10/11 12/13 14/15 16/17

World less China China SU Ratio

-50%

-25%

0%

25%

50%

74/7

5

79/8

0

84/8

5

89/9

0

94/9

5

99/0

0

04/0

5

09

/10

14/1

5

Season highest value

Season lowest value

2015/16: August-May 2016

PRICE VOLATILITY Cotlook A Index: Difference with respect to season average

COTTON & POLYESTER PRICES

0

20

40

60

80

100

120

Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16

Cotlook A Index

China Polyester

Source: Cotton Outlook Ltd.

US cts/lb

27

30

27 26 24

0

20

40

60

80

1960

1971

1982

1993

2004

2015

0

5

10

15

20

25

30

35

Million Tons

WORLD COTTON CONSUMPTION

AND MARKET SHARE OF COTTON

Market Share of Cotton (%)

2020

2025

Thank you

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