Industrial Cluster: Release And Analysis Of American Cotton Balance Sheet In 2024/25

In the balance sheet of American cotton in 2024/25, the output and ending inventory increased, while the export decreased. Domestic use and initial inventory remain unchanged. The report finally provided a negative outlook for increased US production and rising ending inventories.

It was difficult to find new trading news guidance for cotton futures last March. ICE futures closed at the contract low last week, and the selling pressure may be driven by the pricing of speculators and producers. In general, the market is quiet, and there is limited information affecting trading activities.

According to the January supply and demand report released by the US Department of Agriculture last Friday, the US cotton production in 2024/25 is estimated to be 14.41 million bales, and 14.26 million bales in December. The export of American cotton is estimated to be 11 million bales in 2024/25 and 11.3 million bales in December. The ending inventory of American cotton in 2024/25 is estimated to be 4.8 million bales, and 4.4 million bales in December. The inventory/use ratio is currently 37.5%, indicating that supply and demand are loose.

In 2024/25, the global cotton balance sheet will increase global production, consumption, trade and ending inventory, and the beginning inventory will remain unchanged. In 2024/25, the global output will be slightly higher than 2 million bales, reaching 119.4 million bales, mainly due to the increase of 1.8 million bales in China's output. It is expected that the harvests of Australia and the United States will also increase, and the output of Pakistan will decrease. Global consumption increased by 100000 packets, as growth in Bangladesh and Vietnam offset the decrease in Turkey. It is estimated that the export volume will increase by 225000 bales, because the growth of Brazil, Australia and India will exceed that of the United States. The inventory at the end of the period increased by nearly 1.9 million packages, which was offset by the increase in China, the United States, Australia and India.

Globally, the US Department of Agriculture reported that the global cotton output in 2024/25 was estimated to be 119.45 million bales, and in December it was estimated to be 117.39 million bales. The global cotton ending inventory in 2024/25 is estimated to be 77.91 million bales, and 76.02 million bales in December. The total global cotton use is estimated to increase by 100000 bales to 115.89 million bales. The global inventory/use ratio climbed to 67.2%, easing the pressure on global supply and demand.

The export sales of the United States showed that exporters' exports of cotton in 2024/25 reached the annual market high.

The export sales report released by the US Department of Agriculture last Friday showed that the current annual export sales of US cotton increased by 137400 bales in the week ended January 2, up 7% from the previous week and 27% less than the average of the previous four weeks, including a net increase of 3700 tons in export sales to China. Next year, the export sales of American cotton will increase by 0 million bales. The export shipment of American cotton was 191700 bales, an increase of 66% over the previous week and 47% over the average of the previous four weeks, of which 43800 bales were exported to China.

Recently, the shipment has been at a low level, but as the holiday has passed, the growth rate of the shipment has gradually accelerated.

6400 bales of Pima cotton were sold and 8300 bales were shipped for export. The shipment is expected to meet the USDA's estimate.

Traders will pay attention to the US export sales report and begin to turn their attention to the intention of planting new crops.

Next week, the US will release producer price index, consumer price index (CPI) and US retail sales data for December.