Global cotton prices likely to surge by 8% in FY-09
Cotton prices in the global market are likely to surge by 8.10 per cent to 80 cents per pound in 2008-09, triggered by the price trend of competing crops like soybeans, corn, wheat and other oilseeds, the Washington-based International Cotton Advi...
By PTI |
NEW DELHI: Cotton prices in the global market are likely to surge by 8.10 per cent to 80 cents per pound in 2008-09, triggered by the price trend of competing crops like soybeans, corn, wheat and other oilseeds, the Washington-based International Cotton Advisory Committee (ICAC) said.
ICAC Price Model 2007 forecasts a season average 'Cotlook A Index' of 80 cents per pound in 2008-09 against 74 cents per pound in an year-ago period, ICAC said in a statement.
Apart from a rise in prices of competing crops, speculative trading and commodity investment funds would also affect the cotton price movement; it said adding that prices during 2006-07 stood at 59.15 cents per pound.
"The fundamentals of cotton supply and use alone will suggest a season-average Cotlook A Index of less than 70 cents per pound in 2007-08. However, based on trends in prices during the first eight months of 2007-08, it is obvious that prices will be higher," ICAC noted.
According to the ICAC data, cotton production is estimated to go up by 3.17 per cent to 123.4 million bales during 2008-09 against 119.6 million bales in the last year. Consumption is projected at 126.2 million bales, up by 1.28 per cent from previous year.
As a result of the gap between world production and consumption, world ending stocks are estimated to decline for the second season in the current year, ICAC said, adding that the ending stocks are expected to be less by 2.8 million bales at 50.3 million bales in 2008-09.
Meanwhile, the world cotton area is expected to remain relatively stable in 2008-09 at 33.8 million hectares.
However, cotton harvested area in the US is projected to decline by a further 15 per cent in current season as a result of surging prices for soybeans, corn, wheat and other oilseeds.
ICAC Price Model 2007 forecasts a season average 'Cotlook A Index' of 80 cents per pound in 2008-09 against 74 cents per pound in an year-ago period, ICAC said in a statement.
Apart from a rise in prices of competing crops, speculative trading and commodity investment funds would also affect the cotton price movement; it said adding that prices during 2006-07 stood at 59.15 cents per pound.
"The fundamentals of cotton supply and use alone will suggest a season-average Cotlook A Index of less than 70 cents per pound in 2007-08. However, based on trends in prices during the first eight months of 2007-08, it is obvious that prices will be higher," ICAC noted.
According to the ICAC data, cotton production is estimated to go up by 3.17 per cent to 123.4 million bales during 2008-09 against 119.6 million bales in the last year. Consumption is projected at 126.2 million bales, up by 1.28 per cent from previous year.
As a result of the gap between world production and consumption, world ending stocks are estimated to decline for the second season in the current year, ICAC said, adding that the ending stocks are expected to be less by 2.8 million bales at 50.3 million bales in 2008-09.
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Meanwhile, the world cotton area is expected to remain relatively stable in 2008-09 at 33.8 million hectares.
However, cotton harvested area in the US is projected to decline by a further 15 per cent in current season as a result of surging prices for soybeans, corn, wheat and other oilseeds.
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