Cotton Outlook: International

World cotton production in 2021/22 is projected at 120.3 million bales, only marginally above last month’s projection but 8.1 million bales (7 percent) higher than 2020/21.

Global Cotton Production to Increase in 2021/22

World cotton production in 2021/22 is projected at 120.3 million bales, only marginally above last month’s projection but 8.1 million bales (7 percent) higher than 2020/21. The October production estimate includes increases for Pakistan and Turkey and decreases for India and the United States. Global harvested area is forecast at 32.6 million hectares (80.4 million acres) in 2021/22, higher than last season but below each of the previous 3 years. The world cotton yield in 2021/22 is projected at a record 804 kilograms (kg) per hectare (717 pounds per acre), compared with the 3-year average of 770 kg per hectare.

Cotton production among the major-producing countries this season is mixed compared with 2020/21 (figure 4). Production in India—the leading cotton producer—is forecast at 28 million bales, unchanged from 2020/21; lower area resulting from the monsoon’s variation in key cotton regions this season is coupled with a higher projected national yield. Harvested area in India is estimated at 12.4 million hectares in 2021/22, the lowest in 5 years. Meanwhile, India’s yield (492 kg per hectare) is forecast to offset the effect of the area loss. For 2021/22, India is forecast to account for 23 percent of the global cotton crop.

For China, 2021/22 cotton production is projected at 26.75 million bales, 9 percent (2.75 million bales) below the year before, with reductions for both area and yield. Harvested area is forecast about 4.5 percent lower, at 3.1 million hectares, while less favorable growing conditions this season support a lower national yield (1,879 kg per hectare) that is 5 percent below 2020/21’s record. China is expected to account for 22 percent of world production this season. On the other hand, cotton production in Pakistan is projected to increase 2 million bales in 2021/22 to 6.5 million bales, as a considerable rebound in yield to 708 kg per hectare more than offsets a 4-decade low in cotton area. Pakistan is forecast to account for more than 5 percent of the global cotton crop in 2021/22.

For the Southern Hemisphere countries of Brazil and Australia, increases in 2021/22 cotton production are projected, with relatively high cotton prices observed as planting season approaches. For Brazil, a cotton crop of 12.5 million bales is forecast, as area is expected to rebound and a record national yield of 1,814 kg per hectare is projected. Similarly, for Australia, 2021/22 cotton production is forecast to increase 1.9 million bales to 4.7 million, as the easing of drought conditions encouraged planted area to more than double from last season to 575,000 hectares. Together, Brazil and Australia are expected to account for 14 percent of the world’s cotton production in 2021/22.

World Cotton Mill Use Forecast to Increase in 2021/22

Global cotton consumption in 2021/22 is forecast to increase nearly 3 percent this season as the global economy—particularly consumer demand for cotton products—continues to recover from the coronavirus (COVID-19) impacts. At 123.4 million bales, world mill use is expected to rise about 3.5 million bales this season.

For the top cotton-spinning countries, 2021/22 mill use is forecast to expand or remain unchanged from the year before, with the 6 leading countries accounting for a combined 82percent of the world total. In 2021/22, China is forecast to spin 40 million bales of raw cotton, the same as in 2020/21, which was the highest since 2017/18. China is expected to account for nearly one-third of total global cotton consumption in 2021/22. India’s mill use, on the other hand, is projected to increase 5 percent from 2020/21 as the textile industry there expands.  Cotton mill use in India is forecast at a record 25.5 million bales in 2021/22, or 21 percent of the global total.

Cotton mill use is forecast to rise for Pakistan and Bangladesh in 2021/22, reaching 11.2 million bales (+6 percent) and 8.7 million bales (+2 percent), respectively. In addition, cotton mill use is expected to reach 8.4 million bales (+9 percent) in Turkey, while mill use in Vietnam is forecast unchanged at 7.3 million bales in 2021/22. As with the other major spinners, these countries’ 2021/22 share of global mill use is near last season’s level.

Global Cotton Trade and Stocks to Decline in 2021/22

World cotton trade is forecast at 46.4 million bales in 2021/22, 4 percent below last season’s record. Cotton exports are projected to decrease for Brazil, the United States, and India, where supplies (beginning stocks + production + imports) are projected lower in 2021/22. For Brazil, 2021/22 cotton exports are expected to decrease from a record 11 million bales last season to 8 million bales in 2021/22. For India, this season’s cotton exports are projected to reach 5.8 million bales, compared with 6.2 million bales in 2020/21.

With global mill use rising modestly this season, China, Bangladesh, and Vietnam are projected as the leading raw cotton importers in 2021/22. Imports by China are forecast at 10.5 million bales this season, down from nearly 12.9 million in 2020/21. However, China continues to add foreign cotton for rotational purposes in the national reserve and for re-exporting of textile and apparel products. For Bangladesh, 2021/22 imports are forecast at 8.2 million bales (+6 percent), while imports by Vietnam are projected to remain at 7.3 million bales in 2021/22; cotton imports continue to support the textile industries in these countries.

Based on the latest cotton supply and demand projections, world ending stocks are forecast at 87.1 million bales in 2021/22, 3.5 percent (3.2 million bales) below a year ago and the lowest in 3 years. For the major producing countries, 2021/22 stock changes are forecast to vary considerably. Stocks in China are projected to decline 2.8 million bales (7 percent) to 36.5 million bales, or 42 percent of the global total in 2021/22 (figure 5). Similarly, cotton stocks in India are projected to decrease 2.3 million bales (15.5 percent) to 12.4 million bales, accounting for 14 percent of 2021/22 total. In contrast, stocks are expected to rise moderately (+1.3 million bales) in Brazil to 12.4 million bales in 2021/22; like India, Brazil is projected to hold 14 percent of the global stock total at the end of July 2022. Meanwhile, the global stocks-to-use ratio is estimated at 71 percent in 2021/22, compared with last season’s 75 percent. With global cotton demand expanding and stocks declining for consecutive seasons, the 2021/22 Cotlook A-Index price is expected to increase from 2020/21’s average of 85 cents per pound to its highest in a decade at 110 cents per pound.