The world stockpile of cotton reached a record 22.2 million tonnes, with nearly 60 percent of it held by China. The government sold 2 million tonnes of surplus cotton from May to September of this year and the International Cotton Advisory Committee estimates China will sell an additional 1.7 million tonnes, partly because it is restricting the domestic supply by holding imports to the minimums required under trade agreements.
That would reduce China’s stockpile to 9.6 million tonnes at the end of the current marketing year. It still would be the largest in the world, but a smaller share — 54 percent — of a much smaller total, 17.8 million tonnes, which is down 20 percent in two years. Global cotton consumption has been fairly steady, so the reduction in global stocks is a result of a worldwide cutback in cotton production due to low market prices.
Cotton prices are on the rise as the global supply is brought down toward more manageable levels. The ICAC, an intergovernmental body, says the season-average price this marketing year is forecast for 74 cents per pound, up 4 cents from the 2015/16 average.