Cotton Prices Dropped Due To Global Carryover Growing And Declining Demand

Prices for cotton candy fell marginally by -0.07% to settle at 58620, primarily due to a rise in global carryover and a fall in demand. Expectations of higher crop yields in nations like Australia restrained upside possibilities even though the USDA weekly export sales data showed a notable increase in net sales.

For the following season, 2024–25, the International Cotton Advisory Committee (ICAC) forecasts increases in cotton-producing areas, production, consumption, and trade, suggesting a possible change in market dynamics. Cotton stockpiles in India, the second-biggest cotton grower in the world, are predicted to fall sharply in the current marketing year and end up at their lowest point in over thirty years.

Fewer stockpiles are expected to raise domestic costs and affect the profit margins of regional textile producers, limit exports, and sustain worldwide prices. This season, farmers in India are likely to change their acreage to higher-yielding crops, which is predicted to result in a small decline in cotton production.

However, mill consumption is anticipated to increase as demand for yarn and textiles improves in key globally. Due to increased demand for textile and apparel items both domestically and internationally, China is expected to import more cotton in the 2019 marketing year. In Xinjiang, stably planted areas are anticipated to sustain production levels even in the face of a reduction in other regions.

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