Global scenario of cotton production and consumption

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Guest Author: Mr. C.K. Patel, AGM – Agronomy & Marketing, Netafim India

15 July 2021, New Delhi:
As per the report of the United States Department of Agriculture, the global 2020/21 cotton farming is down 6.5 percent from the previous year to 114.1 million bales. The farmers of major cotton-producing countries (India, China, United States, Brazil, and Pakistan) are facing a challenge to compete with their counterparts both in terms of per hectare yield as well as produce. 

Adverse weather, an infestation of pink bollworm in cotton crop, lower prices, higher labour cost and policy uncertainty all contributed to the sharp decline. Additionally, the decreased synthetic fibre prices driven by substantially lower oil prices placed huge competitive pressure on world cotton markets. Normally, India produces up to ~ 3.5 crore bales of cotton, whereas China produces ~3.25, USA produces 2.5 crore bales followed by Brazil and Pakistan which produces ~1.5 and 0.65 crore bales respectively. Although the US and Brazil are major exporters of cotton, the production in both countries has been declining for two consecutive years. Resulting in inefficiency to support the global import demand and the high price of cotton.
 
In terms of cotton consumption, Asian countries dominate the global market. Cotton consumption in China is around 4.75 to 5 crore bales which are higher than other countries of the globe. Whereas Pakistan’s cotton consumption is 1.35 crore bales. In recent years, strong growth of the spinning and textile industry has spurred the consumption of cotton in Bangladesh and Vietnam. 

Bangladesh requires 90 lakhs to 1 crore bales of cotton and Vietnam needs 75 to 80 lakh bales. Due to their proximity to India, all these Asian countries import a substantial quantity of cotton from India. If we talk about the situation in India, the consumption of cotton is increasing here. Due to the phenomenal growth of the domestic textile industry in the last two decades along with the Indian spinning industry, the country has become one of the largest consumers of cotton i.e., about 23% of world cotton consumption.

The brighter spot for cotton farmer globally

The global acreage for cotton has been constant since the last few years. As the world economy recovers from the severe 2020 downturn, global cotton consumption is expected to grow by 4.1 percent in the 2021-22 season, substantially above the long-term average rate of 1.7 percent, according to the US department of agriculture (USDA). 

World cotton production is projected to grow 1.5% p.a. to reach almost 30 Mt in 2029. This growth will come from an expansion of the cotton area (0.5% p.a.) as well as growth in average global yields (1% p.a.), suggest OECD-FAO Agricultural Outlook 2020-2029.

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