The global cotton industry is currently grappling with substantial reductions in both production and consumption, as outlined in the 2023-24 Cotton: World Markets and Trade report by the US Department of Agriculture (USDA).
Production has experienced a consecutive two-month decline, now totaling 112.4 million bales. This marks a significant drop of more than 4.4 million bales compared to forecasts made just two months earlier. The decline can be attributed to reduced outputs across various regions, including West Africa, the United States, Greece, Mexico, and India, which have offset the production increase observed in Brazil.
On the consumption front, a decrease of 1.1 million bales brings the forecast down to 115.9 million bales. This reduction is primarily due to diminishing supplies in major consuming nations like India and China. While consumption is expected to be 5 million bales higher than the previous year, this growth is more subdued due to depleted resources and economic instability, which are affecting usage rates, as stated in the report.
Global trade projections have also been revised downward by approximately 600,000 bales to 43.3 million bales. This adjustment reflects the reduced consumption in major importing countries, notably Bangladesh and Vietnam.