Making sense of cotton numbers is not too difficult. There aren't too many market reports to peruse that taken together tend to confuse the reader more than make sense.
The two sets of numbers that cotton watchers pay heed to come from the International Cotton Advisory Committee (ICAC) and the annual outlook jointly published by the Food and Agriculture Organization (FAO) and the Organisation for Economic Co-operation and Development (OECD). Read together with the numbers from Textile Exchange's yearly, now-rechristened Materials Market Report, the cotton picture is clearer still.
When the theme of the World Cotton Day this year is 'Cotton for Good', it is only germane to ascertain if the numbers look good. Some might even argue that the theme itself is a fait accompli since cotton is always for good. But given that the mob of detractors has been swelling up in the last decade (and quite aggressively so) and that polyester is virtually steamrolling every other fibre, the numbers around cotton need to be looked at closely and carefully.
Let's pick up two publications that look at the state of production, consumption and trade and also make projections for the coming years: Cotton - Review of the World Situation published by the ICAC less than two months back and OECD-FAO's Agricultural Outlook 2024–2033, released in early July.
The production: Current state and the future
There hasn't been much change at the global production level with the Big Three (India, China and the United States) and the Lesser Two (Brazil and Pakistan) together making up for more than three quarters of the global cotton output. For 2023–24, ICAC expected the global cotton production numbers to be 24.12 million tonnes, "showing a slight decrease from the previous year." All Big Three are set to produce less this year.
According to OECD-FAO, the global production of cotton is expected to grow steadily and reach 29 million tonnes by 2033, 17% higher than in the base period. The "foreseen increase will mostly come from growth in the main cotton producers: India will account for about 38% of the global increase, followed by the United States (27%), and Brazil (21%). Overall, gains in cotton production are predominantly driven by higher yields, and to a lesser extent, on expansion in area harvested."
In some ways, this projection is agnostic and does not take into account many of the problems that cotton has had to confront in the last year or so.
Yet, it is interesting to note what the OECD-FAO base their growth figures on: "average global yields are projected to increase by 11% compared to the base period. Factors such as improvements in genetics, better agricultural practices, and digitalisation supporting precision agriculture will significantly contribute to enhance productivity and sustainability."
This may or may not seem optimistic, but what it surely does not do is take into account how cotton would be placed vis-a-vis the other fibres. Ironically, this is also why the Outlook report is significant: it looks at cotton purely as an agricultural commodity. "By 2033, yields in China and Brazil are projected to double the world average, while in India, the largest cotton producer, yields are expected to remain below it." The yield factor would be one to keep one's eyes on.
