Cotton prices will edge up to their higher in five years next season, the International Cotton Advisory Committee forecast, as it cut its forecast for inventories to the lowest since 2011-12.
The intergovernmental group, in its first forecast for cotton prices in 2018-19, which starts in August, saw them averaging 84 cents a pound, as measured by the Cotlook A index of physical values. The ICACs price forecast came as it trimmed by 220,000 tonnes, to 17.93m tonnes (82.4m bales), its estimate for cotton inventories at the close of 2018-19.
Stocks at that level would be the lowest since 2011-12, when US inventories were recovering from a 20-year low.Meanwhile, cotton output will ease next season by 320,000 tonnes to 25.35m tonnes (116.4m bales), the committee said, cautioning that n++the threats of pests and inclement weather remain concerns.
The ICAC estimates for 2018-19 show, at 1.17m tonnes, a far greater drawdown in world cotton stocks than expected by Cotton Outlook, which last week trimmed its forecast for the decline by 10,000 tonnes to 573,000 tonnes.