Cotton prices fell on hopes for a better crop

Prices for cotton candy saw a little decrease of -0.03% yesterday, ending at 57580. This was mostly due to expectations of higher agricultural harvests, especially in nations like Australia. With the growth in cotton-producing areas, production, consumption, and commerce, the International Cotton Advisory Committee (ICAC) predicted a favorable cotton season for 2024–2025.

Specifically, the ICAC projects that the cotton-producing region will grow by 3% to 32.85 million hectares, and that the crop will produce more than 2.5% more, or 25.22 million tonnes, more than predicted. It is also anticipated that consumption and the world’s cotton trade will rise by 2.9% and about 4%, respectively.

The production projections for the current season were increased upward by the Cotton Association of India (CAI) and the Cotton Corporation of India (CCI) in India, suggesting a possible surplus. Some of this excess could be offset, though, by projections of a 2% drop in cotton acreage for the next growing season as a result of farmers switching to higher-return crops.

The dynamics of cotton imports and production from China and India are crucial on a global scale. The anticipated decline in cotton production for MY 2024–2025 in India, along with increased imports and mill use, highlights the changing nature of the market. In a similar vein, growing local and global demand for textile and clothing goods is reflected in China’s anticipated rise in cotton imports for the same time frame.

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