As per the latest report published by the United States Department of Agriculture (USDA), world cotton will observe a 10 per cent fall in the year 2016-17 as against the previous season to 87.3 million bales due to the large decline in beginning stocks. As China is consistently reducing its stocks accumulation, the world cotton stock is expected to reach its lowest point since 2011-12.
More than 12 million bales of cotton are reported to be sold from China’s national reserve. The surge in trade is because of the increase in Bangladesh import demand and very high early-season imports from India. Consequently, Chinese exports for United States and Australia showed a significant increase. However, the stock reduction by China has affected the world cotton market.
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In spite of the reduction in the cotton stocks, China will still be possessing 55 per cent of the world cotton stock of 48 million bales at the end of 2016-17.
