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Global cotton prices under pressure on supply glut

Our Bureau

MUMBAI, July 13

PROSPECTS for a bumper global cotton crop that will exceed projected world consumption have pushed prices down to the second lowest world's cotton A-index price in the past three years, averaging 58.1 cents per pound through June of 2000-01 season.

The price is 5 cents above the similar period last year, but down from the recent average peak of 72.1 cents in 1997-98.

Global cotton production is set to expand in 2001-02 with significant improvement in contributions from the US, China and India where much of the increase will result from area expansion and yield increases.

World cotton production for 2001-02 is forecast at 94.6 million bales (480 pounds), up 6.6 million bales from last year's output, according to the U.S. Department of Agriculture (USDA). World area is forecast at 34.1 million hectares, up 2.3 ml.ha from l ast season, while the yield at 603 kilograms per hectare is nearly unchanged from 2000-01.

The world's largest cotton producers the US and China are projected to account for 43 per cent of global production, equal to last year. The seven top cotton producers of the world - China, USA, India, Pakistan, Uzbekistan, Turkey and Brazil - are estima ted to produce 74.4 million bales, accounting for 90 per cent of the 6.6 million bales increase this season.