China, India and Pakistan are providing supports to cotton growers in the face of low market prices, said the International Cotton Advisory Council. The intergovernmental group says, “Given low prices and high production costs, many governments of large cotton-producing countries are taking measures to help growers.” China has announced a cotton subsidy for nine provinces as well as limiting imports. In Pakistan, 1 million bales of cotton are expected to be purchased this month at the government-set minimum price. Low prices have triggered supports in India as well, says ICAC.
Cotton production worldwide is forecast for 26.3 million tonnes this season, the third year in a row of large crops and rising surpluses. An inventory of 21.6 million tonnes, nearly a 10-month supply, is forecast in storage at the end of this marketing year. Cotton prices are forecast to average 74 cents per lb this year, compared to 91 cents last season.