USDA has released its June 2022 World Agricultural Supply and Demand Estimates (WASDE) report. Here’s this month’s summary for cotton:
The 2022/23 U.S. cotton supply and demand projections are unchanged from last month, with the exception of a 5-cent increase in the season-average upland farm price to 95 cents per pound. A sharply higher percentage of U.S. upland area has been forward contracted for 2022/23 as of May 31, and futures prices for the post-harvest months remain strong. There are no changes to the 2021/22 U.S. balance sheet, and the projected farm price remains 92 cents.
The 2022/23 world cotton balance sheet includes slightly higher production and slightly lower consumption projections compared with the previous month, and ending stocks are virtually unchanged. Production is 200,000 bales higher due to a 100,000-bale increase for Egypt along with smaller changes for West African producers. Global consumption is 450,000 bales lower, with the largest declines in Mexico, Bangladesh, and Vietnam.
Beginning stocks for 2022/23 are also lower this month as a 1.5-million-bale decline in 2021/22 global production more than offsets a 1.25-million-bale decline in projected consumption. A 1.0-million-bale drop in India’s crop accounts for most of the production change, with lower yield expectations in Brazil accounting for the remainder.
Consumption is projected 500,000 bales lower in both China and India, with smaller declines for Mexico and Vietnam.
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