U.S. cotton acreage is likely to drop 3.7% this year as producers deal with prices that could fall below the cost of production, according to the National Cotton Council.
Jody Campiche, NCC’s vice president of economics and policy analysis, estimates in the group's 2024 outlook that farmers will plant 9.8 million acres this spring. Campiche projects an abandonment rate this year of nearly 18%, which would leave 8.1 million acres to be harvested.
American mills are expected to increase processing by about 5.4% to 1.85 million bales, but an NCC release notes the U.S. textile manufacturing sector lost eight facilities in the last five months of 2023. The industry “remains under pressure from weaker Western Hemisphere trade due to concerns about the impacts of increased U.S. textile imports under de minimis provisions,” NCC said.
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World production is also expected to increase on higher harvested area. NCC projects global demand will take on “a more positive tone as the economic outlook has improved in the past month.” Global ending stocks were trimmed to 83.5 million bales on “higher world production, consumption and trade.”
The United States is expected to remain the largest global exporter, with Brazil “just slightly behind the U.S. in export sales,” NCC says.
“Given the recent trends in exports from the two countries, Brazil is on track to become the largest cotton exporter in the very near future,” the organization says.
NCC says the domestic and global economic projections “should be viewed with caution given the continued impacts of tighter monetary policy, high interest rates, and geopolitical tensions.”
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