WASDE: US Cotton Production, Ending Stock Lowered But Exports Revised Up

MUMBAI(Commoditiescontrol): USDA brought downward revision to US cotton production, upward revision to US export estimates which took the ending stock lower for the current season 2017/18.

The upward revision to US export figures is the highlight of the report and in line with our predictions. Significant improvement in the weekly cotton shipment progress, during the month of February, has led USDA to believe that 14.8 million bales(480lb) could be achievable.

Today’s export report showed weekly shipments figure touching near 12 year high at 551,244 RB. (Full Report)

The WASDE report is bullish for the ICE US cotton futures as the benchmark May contract persists rally trading at 84.16 cents/lb, up 1.6% from prior close at 82.86 cents/lb. Trade range as of publishing this report is 82.96-85.25 cents/lb.

USDA comments:

This month’s 2017/18 U.S. cotton forecasts show lower production, higher exports, and lower ending stocks relative to last month. Production is reduced 233,000 bales to 21.0 million, based on the March 8 Cotton Ginnings report.

The final estimates for this season’s U.S. area, yield, and production will be published in the May 2018 Crop Production report. Domestic mill use is unchanged from last month, but exports are raised 300,000 bales to 14.8 million, based on stronger world demand and expectations of above-average shipments during the second half of the marketing year. Ending stocks are lowered 500,000 bales to 5.5 million.

The projected range for the marketing year average price received by producers of 68.0 to 70.0 cents per pound is narrowed by 1 cent at each end from last month.

The forecast for 2017/18 global production is raised nearly 600,000 bales this month due to revisions in Sudan’s estimates back to 2013/14 and higher area in Australia, partially offset by smaller crops in the United States and Uzbekistan.

Sudan’s 2017/18 forecast is raised 730,000 bales based on reports of new technology and investment, and Australia’s production is raised 300,000 bales following reports area previously forecast for sorghum was planted to cotton.

World consumption is raised slightly, while world trade is forecast 600,000 bales higher, as higher expected imports by Turkey, Bangladesh, China, and Vietnam more than offset a decline for Taiwan. World ending stocks are now projected at 88.8 million bales, nearly 300,000 bales above last month.



(By Commoditiescontrol Bureau; +91-22-40015534)