Cotton stocks forecasted to rise in 2012/13

The latest USDA projections for 2012/13 indicate that world cotton stocks are expected to rise for the third consecutive season, reaching a record 74.5 million bales for 2012/13, nearly 11 percent or 7.2 million bales above 2011/12. World cotton stocks have grown as a result of recent record cotton prices that encouraged area increases in 2010 and 2011 that subsequently led to large crops. Meanwhile, higher prices promoted substitution away from cotton by mills, and the slowdown in the global economy reduced demand further, exacerbating the rise in stocks. In China, stocks are projected to expand nearly 20 million bales over a 2-year period because of extensive purchases for its national reserve program, with these stocks likely to be used by Chinese mills as demand rebounds. This chart is found in the Cotton and Wool Outlook, CWS-12d, June 2012.

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