Wednesday, July 28, 2021

Slow growth to affect the cotton industry for years to come?

Cotton processors in Botswana will be unhappy with the reduction in cotton-lint production in South Africa ÔÇô five percent down from estimates made by Cotton South Africa last month. Botswana purchases seed cotton from a South African gin, as do ginners in Swaziland and Namibia .

Declining production impacts on the cotton industry’s value chain. According to a report released by Cotton South Africa , the amount produced represents about 14 percent less than the previous season’s crop. Cotton South Africa , which represents growers, processors and textile makers, has now forecast production of a total of 42 024 bales.

The decrease appears to be part of a worldwide trend, however, with the International Cotton Advisory Committee (ICAC) predicting that world cotton production is set to decrease by about five percent to 22.2 million tons in 2009/10. This is due to lower crop yields and a decrease in cotton’s price competitiveness as against competing crops. World cotton yields have entered a period of slow growth and the picture is less than rosy.

Despite these indicators, ICAC predicts that the world cotton trade will increase by about six percent in 2009/2010 to seven million tons. But cotton stocks are expected to fall by about 13 percent, which would be the biggest decline in seven years.

RELATED STORIES

Read this week's paper