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Uncertainty Over Cotton Prices In 2017/18

The Indian Textile Journal

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September 2017

In 2017-18, world cotton production is projected to increase by 8 per cent to 24.9 million tonne while the global cotton consumption is forecast to rise by 2 per cent to 25 million tonne.

Uncertainty Over Cotton Prices In 2017/18

The International Cotton Advisory Committee’s Secretariat has forecast that the A Index in 2017-18 will range between 54 cts/lb and 87 cts/lb with a midpoint of 69 cts/lb. The midpoint would be 13 cts/lb lower than in 2016/17. This follows the large increase of 12 cts/lb from 2015-16 to 2016-17, which suggests that such a drop is not unreasonable. However, the season-average A Index in 2016-17 ended up being much higher than the Secretariat initially forecast, and market fundamentals do not explain why this occurred. Given what happened in 2016-17, it is difficult to say whether the current forecast for 2017-18 will hold up well over the season.

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