Global Stocks Projected to Decrease 10% in 2018/19

Date Posted: 04 Sep, 2018
For Immediate Release  

Executive Summary
Highlights from the September edition regarding the 2018/19 season:
  • Global production projected to decrease 3% to 26 million tonnes 
  • Consumption is projected to increase 3% to 27.8 million tonnes 
  • Global stocks are expected to decrease 10% to 16.9 million tonnes
  • Stocks in China are poised for a 23% decline to 6.6 million tonnes 
Global Stocks Projected to Decrease 10% in 2018/19
The 2018/19 season is projected to see a 3% decrease in production, a 3% increase in consumption, and a 10% drop in global stocks, which would bring the world’s cotton reserves down to a level not seen since the 2011/12 season. The global stocks-to-use ratio is expected to drop to about seven months of mill use (0.61).

The decrease in global stocks will largely come from a drawdown in China’s warehouses. From March through August 2018, the Chinese State Reserve sold more than 2 million tonnes of fibre, reducing stocks to about 8.6 million tonnes. If production and consumption remain at current projected levels, the 2018/19 season is expected to further reduce stocks in China to 6.6 million tonnes, reflecting a 23% decline. 

Stocks outside of China are trending in the opposite direction, increasing 24% in 2017/18 to 10.1 million tonnes. The increase is expected to slow in 2018/19, ticking upward to 10.2 million tonnes. By the end of the coming season, warehouses outside of China are expected to house about 61% of the world’s global reserves.

Ending stocks in China reflect growing mill use in China and may signal the possibility of increased imports in 2018/19. Growing global demand in 2018/19, despite uncertainty about trade policies, may lead to price increases amidst a possible global production decrease.

  2016/17 2017/18 2018/19   2016/17 2017/18 2018/19
          Changes from previous month
  Million Tons   Million Tons
Production 23.08 26.87 25.98   0.00 0.23 0.04
Consumption 24.52 26.93 27.80   0.00 0.78 0.38
Imports 8.12 9.00 9.65   0.00 0.01 0.33
Exports 8.19 9.00 9.65   0.00 0.01 0.33
Ending Stocks 18.80 18.74 16.91   0.00 -0.54 -0.88
Cotlook A Index* 83 95 88*        

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