Cotton Prices May Remain Low At The End Of 2020

The new forecast shows that cotton prices are likely to remain low in the near future due to increasing cotton stocks and continued economic uncertainty.

The International Cotton Advisory Committee (ICAC) updated cotton prices, updating the cotton price index (cotook aindex) forecast for the end of 2020 and 2021 to 67 cents per pound. This is slightly higher than the average price forecast of 62.8 cents per pound at the end of August.

The International Cotton Advisory Committee (ICAC), a commodity Association of cotton producing, consuming and trading countries, believes that the global recovery will also be affected by different countries' ability to cope with the new outbreak no Be consistent.

ICAC said: Although countries around the world fell into a new coronal pneumonia pandemic almost at the same time, they will recover at different rates according to their ability to stop the spread of the virus and restart the economy.

Given that global cotton production of 25.1 million tons is expected to exceed consumption, cotton stocks are likely to increase by 7.2% to 24.3 million tons by 2020 / 21. Economic recovery action is also hindered by the increase in cotton stocks, which will lead to further growth of stocks.

ICAC also pointed out: there are some positive signs that we are optimistic: spinning mills in Vietnam, Bangladesh and India have reached 75% capacity in July. However, according to the current inventory utilization ratio of 0.97, there are enough cotton in warehouses around the world to meet the cotton demand for nearly a whole year.