Market Dynamics: Cotton Price In 2021 / 22 Is The Highest Level In Ten Years

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The International Cotton Advisory Committee (ICAC) recently said that cotton farmers are optimistic about the next price, and it is expected that cotton prices will remain at a high level until 2021 / 22.

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However, ICAC points out that price is a double-edged sword. The increase in farmers' income may prompt them to increase the global cotton planting area, but the increased price cost is usually transferred through the supply chain, making cotton less competitive with other fibers.

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For the rest of 2021 / 22, cotton prices are expected to fluctuate, but should not be much higher than the current level. According to the ICAC Secretariat, cotton prices rose all the way to 243.65 cents / pound in 2010 / 11, but it is not expected that the new price or its fluctuation will be the same.

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Plant utilization will remain strong in 2021 / 22, with global inventories sufficient to meet demand. By the end of 2020 / 21, global inventories are estimated to be 20.35 million tons.

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The Secretariat currently forecasts that the average A-index price in 2021 / 22 will be between 91-119 cents / pound, with a median of 103.29 cents / pound.

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In November 2021, ICAC said that compared with 2020 / 21, global cotton production is expected to grow by 6%, among which three of the world's top five cotton producing countries: the United States, Brazil and Pakistan have the largest increases.

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The agency recently announced that Nal trade centre is working to double the yield of at least 50000 small-scale cotton farmers in Zambia by January 2024.