Joseph W. Glauber, chief economist for the USDA, recently delivered his “Prospects for the U.S. Farm Economy in 2010.” In reference to cotton, Glauber stated:
“World cotton production (up 10.5 percent) and consumption (up 2.6 percent) are both projected to rise in 2010/11, with world consumption outpacing the increase in production due to continued economic recovery. Thus, a further drawdown in world stocks is anticipated. Global cotton ending stocks for 2010/11 are projected to be the lowest since 2003/04.
“U.S. planted area is projected at 10.5 million acres, up 15 percent from 2009, producing a crop of 16.0 million bales. Higher cotton prices relative to alternative crops, especially corn and soybeans, will boost area. The production increase from 2009 is nearly 30 percent based on a normal weather assumption.
“U.S. exports will be limited by available supplies and are forecast at 12.6 million bales, leaving ending stocks of about 3.4 million. The stocks-to-use ratio of 21 percent in 2009/10 is projected to remain about the same in 2010-11. The marketing year average price is projected at 64 cents, compared with 62 cents for 2009/10.
The USDA also estimated that China will import 10 million bales of cotton in 2010-11, up 1 million bales from this marketing year. China’s domestic cotton crop is estimated at 35 million bales this year, compared to 32 million bales in 2009.
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