World cotton trade is expected to increase by 8 per cent to 6.5 million tonnes in FY10 with India contributing most to it, the International Cotton Advisory Committee (ICAC) said on Tuesday.
India may account for most of the expected rise in world exports, with the country’s shipments forecast to almost triple to 1.1 million tonnes, the ICAC, an association of governments of cotton-producing and -consuming countries, said in a statement.
Chinese imports are projected to rise marginally to 1.45 million tonnes as its government has started selling cotton from its national reserve to textile mills.
“Beginning at the end of May 2009, the government of China started selling cotton from the national reserve to domestic textile mills. The quantities sold will affect FY10 Chinese imports,” ICAC said.
The cotton body also forecasts US exports to decline by 11 per cent to 2.3 million tonnes in FY10.
Commenting on cotton prices, the body said globally the rates are likely to decline marginally in FY10 despite higher export estimates due to an expectation of rising stocks. The opening stocks in FY10 are estimated at 60 million bales compared to 56.9 million bales in the previous year.
The global price may be 54 cents a pound in FY10, as compared to an estimated 60 cents a pound in FY09. However, major uncertainties regarding projected cotton trade in this year pose substantial risks to this forecast, ICAC said.
It also said that world cotton production is expected to decline for the third consecutive season to 23.4 million tonnes, down by one per cent. Production is expected to decline in Brazil, China, Uzbekistan and Turkey.
The use of cotton by mills across the world is expected to increase by two per cent to 23.3 million tonnes in FY10 and the projection is based on a modest recovery in world economic growth in 2010, ICAC said.
Source : Business Standard