Professional Documents
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A Presentation On Cotton
A Presentation On Cotton
Management
A presentation on
COTTON
• Clothing retailers, were left reeling again when cotton prices An indefinite ban on raw
exceeded the US$1-a-pound barrier for the first time in 15 years cotton exports from India, the
No. 2 cotton producer.
– Executives predicted retail markups in the low-single digits for
holiday goods, including robes, sleepwear and other items, Shrinking cotton inventories
and said the more difficult challenge will be for spring 2011, will drive the stocks-to-use
when increases could be as much as 10% ratio to the lowest level in 16
years, according to the U.S.
Department of Agriculture.
• The increases are the market's reaction to limited supply, largely
as a result of the devastating floods that have hit a number of Cotton mills in Pakistan might
shut. The country is the world’s
countries in South Asia in recent weeks, strong demand, and fourth-biggest cotton producer
inventories being run down but relies on Indian imports for
domestic demand.
• The Department of Agriculture in the US, which acts as the World consumption in 2010-11
benchmark for crop markets, has forecast that cotton inventories is forecast to exceed
production for the fifth straight
around the world will fall in 2010-11 to 45.4 million bales, the year, the first time this has
lowest level for 14 years happened in 50 years.
Cotton Prices: India Market Situation
• Complicating tight supply conditions are trade restrictions
– India recently announced it was going to further delay fiber exports, postponing the start date from October 1 to
November 1.
– With India the world’s second largest exporter, there is strong interest in securing Indian cotton while it is available.
– Fiber exports from India require registration. The registration process opened on October 1 and by October 10
India’s Office of the Textile Commissioner reported that all of the 4.3 million bales (5.5 million 375 lb Indian bales)
available for export have already begun the registration process
– Given India’s limits on exports, there has been strong interest in securing cotton from the U.S. Thus far into the crop
year, U.S. export sales have averaged more than 500,000 bales a week, a pace exceeding that from 2005/06 when
U.S. exports reached a record 17.7 million bales.
– The USDA forecasts 2010/11 U.S. exports to total 15.5.million bales. U.S. export commitments through the end of
September totaled 9.9 million bales, representing 52.4% of a U.S. harvest forecast to be 54.8% larger than it was in
2009/10.
Cotton market share on the decline!
End-use consumption of cotton will decline by
1.8% in 2008 and 2% in 2009, falling to 25.4
million tons in 2009 (IMF, the ICAC Textile)