The latest U.S. Department of Agriculture (USDA) projections for 2009/10 indicate that world cotton stocks are expected to decline for the third consecutive season.

Global ending stocks are currently forecast at 56.3 million bales for 2009/10, 5.2 million bales (8.5 percent) below 2008/09 and the lowest since 2003/04s 48.1 million bales.

For 2009/10, the world stock reduction is largely attributable to China-the leading cotton producer and consumer-where 45 percent of the global decline is expected. However, stocks are expected to decline in most of the cotton-producing countries this season. In China, stocks are forecast to decline 2.3 million bales to 17.6 million, their lowest in 7 years. U.S. ending stocks are expected at 5.6 million bales in 2009/10, 600,000 bales below 2008/09 and the lowest in 5 years.

Meanwhile, stocks in India-the second largest producer and consumer-are forecast only marginally lower and will likely play a key role in the global trade of raw cotton in 2009/10.

Source: U.S. Department of Agriculture