The latest USDA report featured decreases in global production (-3.1 million bales to 117.0 million) and mill-use (-839,000 bales to 119.1 million) forecasts for 2022/23. Revisions to historical figures lifted beginning stocks +685,000 bales to 84.7 million. The net result for world ending stocks was a -1.5 million bale decrease. The current projection calls for 82.8 million bales of ending stocks in 2022/23. This is the lowest volume since 2018/19, when global ending stocks were 81.5 million bales and the A Index averaged 84 cents/lb.
At the country-level, the only change over 100,000 bales was for the U.S., where the forecast plummeted -2.9 million bales to 12.6 million. If realised, this would be the smallest U.S. crop since 2009/10. With this reduction, the U.S. dropped to the fourth position in the rankings of the world’s largest cotton producers (behind China, India, and now Brazil). The U.S. still ranks as the world’s largest exporter (12.0 million bales forecast, Brazil is expected to export 9.3 million bales in 2022/23).
In terms of mill-use, the largest changes to 2022/23 projections included those for the U.S. (-200,000 bales to 2.3 million), Vietnam (-200,000 bales to 6.9 million), Bangladesh (-100,000 bales to 8.5 million), and Turkey (-100,000 bales to 8.5 million). There were also notable updates to figures for 2021/22, which included decreases for India (-500,000 bales to 25.0 million), Pakistan (-100,000 bales to 10.8 million), and Vietnam (-100,000 bales to 6.8 million) as well as a 100,000 bale addition for Turkey (to 8.7 million).
The global trade forecast for 2022/23 was lowered -1.8 million bales to 44.6 million. Revisions to import figures were widespread. The largest changes included those for China (-1.0 million bales to 9.0 million), India (-200,000 to 1.5 million), Pakistan (-200,000 bales to 4.8 million), Vietnam (-200,000 bales to 7.0 million), Bangladesh (-100,000 bales to 8.4 million), and Turkey (-100,000 bales to 4.9 million). In terms of exports, the largest updates were for the U.S. (-2.0 million bales to 12.0 million) and Australia (+200,000 bales to 6.2 million).
Meanwhile cotton prices continue to be caught between the two competing storylines that have been in play for the past several months.On one side, there is the deteriorating global macroeconomic situation. The International Monetary Fund (IMF) lowered its
