Cotton Outlook: Falling Consumption Alters Supply And Demand Outlook

During the past month, Cotton Outlook's estimate of global raw cotton consumption during the season now drawing to a close has been reduced by over 400,000 tonnes. The result is to place the season's supply and demand broadly in equilibrium. The reduction to the forecast for the 2011/12 campaign amounts to nearly 900,000 tonnes, which far outweighs a net fall in the production figure, and sharply increases, to almost 2,000,000 tonnes, the extent to which supply is expected to exceed demand during the season ahead. During the 2009/10 season, world stocks were reduced by over 3,300,000 tonnes, precipitating a bullish trend in the world market that persisted until March of this year.