cotton economic update beltwide cotton conferences january 8-11, 2008 nashville, tn
TRANSCRIPT
Cotton Economic Update
Beltwide Cotton Conferences
January 8-11, 2008Nashville, TN
Cotton Prices
30
40
50
60
70
80A
ug
-04
De
c-0
4
Ap
r-0
5
Au
g-0
5
De
c-0
5
Ap
r-0
6
Au
g-0
6
De
c-0
6
Ap
r-0
7
Au
g-0
7
De
c-0
7
Ce
nts
pe
r L
b
Nearby NY A Index (FE)
Cotton Production (Mil Bales)
02-06 2007 Share
World 109.1 118.8
1. China 28.2 35.5 30%
2. India 16.9 24.0 20%
3. US 20.8 19.0 16%
4. Pakistan 9.4 8.5 7%
5. Brazil 5.5 7.0 6%
US Cotton 2007 Planted Area
Mid-South2,740 -35%
West693
-15%Southwest
5,150-25%
Thousand Acres & % Change from 2006
Southeast2,264 -32%
Relative Futures Prices at Planting Time
0
2
4
6
8
10
12
14
16
98 99 00 01 02 03 04 05 06 07
Pri
ce
Ra
tio
Corn/Cotton Soy/Cotton Wheat/Cotton
Change in ’07 Cotton Area
-29%
2%4%
0%3%
-5%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
US China India Pakistan Brazil All Others
% C
ha
ng
e
Cotton Mill Use (Mil Bales)
02-06 2007 Share
World 108.9 128.3
1. China 39.1 55.0 43%
2. India 15.3 19.3 15%
3. Pakistan 10.7 12.0 9%
4. Turkey 6.7 7.2 6%
5. US 6.2 4.6 4%
Annual Change in World Mill Use
-4
-2
0
2
4
6
8
10
12
98 99 00 01 02 03 04 05 06 07
Mil
lio
n B
ale
s
Price Indices
80
90
100
110
120
130
140
150Ja
n-0
4
May
-04
Sep
-04
Jan
-05
May
-05
Sep
-05
Jan
-06
May
-06
Sep
-06
Jan
-07
May
-07
Sep
-07
Jan
-08
Ind
ex (
2005
= 1
00)
A (FE)
Cotlook Yarn
Asian Polyester Excl China
China Mill Use & Imports
0
10
20
30
40
50
60
98 99 00 01 02 03 04 05 06 07
Mil
lio
n B
ale
s
Imports Tariff-Rate Quota Mill Use
* Crop Year estimated based on PCI Fibres data
China’s Prices Above A Index
40
50
60
70
80
90
100A
ug
-05
De
c-0
5
Ap
r-0
6
Au
g-0
6
De
c-0
6
Ap
r-0
7
Au
g-0
7
De
c-0
7
Ce
nts
pe
r L
b
China Cotton Index A Index (FE)
India Emerging as Exporter
0
5
10
15
20
25
30
98 99 00 01 02 03 04 05 06 07
Mil
lio
n B
ale
s
Exports Production Mill Use
Indian Cotton Priced Below Other Growths
-6
-4
-2
0
2
4
68
/2/0
5
10
/2/0
5
12
/2/0
5
2/2
/06
4/2
/06
6/2
/06
8/2
/06
10
/2/0
6
12
/2/0
6
2/2
/07
4/2
/07
6/2
/07
8/2
/07
10
/2/0
7
12
/2/0
7
Ce
nts
pe
r L
b
India Quote Relative to Other 5 Lowest
US Mill Use & Retail Demand
0
5
10
15
20
25
30
98 99 00 01 02 03 04 05 06 07
Mil
lio
n B
ale
s
Mill Use (Crop Yr) Retail Demand (Cal Yr)
US Exports
0
4
8
12
16
20
98 99 00 01 02 03 04 05 06 07
Mil
lio
n B
ale
s
China Turkey Mexico All Others
Relative Futures Prices for ’08Strong Competition for Acres
0
2
4
6
8
10
12
14
16
98 99 00 01 02 03 04 05 06 07 08
Pri
ce
Ra
tio
Corn/Cotton Soy/Cotton Wheat/Cotton
World Cotton S&DProduction Expected to Fall Short of Use
80
90
100
110
120
130
140
98 99 00 01 02 03 04 05 06 07 08
Mil
lio
n B
ale
s
Mill Use Production
Cotton Futures
40
50
60
70
80
90J
an
-07
Fe
b-0
7
Ma
r-0
7
Ap
r-0
7
Ma
y-0
7
Ju
n-0
7
Ju
l-0
7
Au
g-0
7
Se
p-0
7
Oc
t-0
7
No
v-0
7
De
c-0
7
Ja
n-0
8
Ce
nts
pe
r L
b
Dec 07 Dec 08 May 09
MerchantsGinners Cottonseed
Producers
Cooperatives
WarehousesManufacturers