Page 6 - 21 Cotton SA February 2020

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COTTON SA

by Mario Botha, Cotton SA

OUTLOOK FOR
2019/20 – LOWER
CONSUMER GROWTH
AS GLOBAL ECO-
NOMIC GROWTH
SLOWS DOWN
While global cotton consumption con-
tinues to increase, with recovery starting
in 2012/13, the current prediction ac-
cording to the International Cotton Advi-
sory Committee (ICAC) for 2019/20 is
26,2 million tonnes, which is a 0,3%
growth compared to the previous sea-
son. Global economic growth has
de creased to the lowest levels in
decade s, as global trade disputes re-
main unresolved, resulting in uncertainty
to secure increased manufacturing and
investment. In the cotton industry, the
economies of Asia and Southeast Asia
have led consumption, and it is expect-
ed that growth in manufacturing and the
demand in consumption of cotton con-
sumer goods, will decelerate globally.
Settling the trade war, revising
global trading rules, and increasing
transparency in trade policies will help
support growth, rebuild investment
and increase consumer confidence for
the cotton and broader economy. The
current prospect for global cotton trade
indicates a decline of 3% in volume with
a projected consumption of 9 million
tonnes. China is expected to continue
leading global consumption of cotton
with 8,05 million tonnes, which is 2,4%
less compared to the previous season.
With domestic production expected
to decrease to 5,8 million tonnes,
imports will be necessary to support
the mill use and replenish the reserves.
Chinese national reserves are estimated
at less than 3 million tonnes. China is
expected to be in the lead, accounting
for 20% of global imports.
In 2017/18, the imports from the
USA represented 45% of China's
total imports of 1,2 million tonnes. In

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