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Cotton forecaster raises 2015/16 inventories forecast on weaker demand

Published 2015-09-24, 04:00 p/m
© Reuters. Cotton forecaster raises 2015/16 inventories forecast on weaker demand

By Chris Prentice
NEW YORK, Sept 24 (Reuters) - Excess world cotton
inventories will not fall as dramatically this year as
previously expected amid a weaker demand outlook and higher
carryover stocks, said industry analysts at Cotton Outlook
(Cotlook) in a monthly forecast on Thursday.
Inventories will drop by 520,000 tonnes (2.4 million 480-lb
bales) during the current crop year from the 2014/15 crop year
that ended July 31, a more bearish outlook than last month when
Cotlook saw them falling by 584,000 tonnes.
Consumption is expected to total 23.82 million tonnes, down
from the August forecast of 23.94 million tonnes though still
higher than 2014/15's level of 23.64 million tonnes, Cotlook
said in the report.
The bearish outlook for demand comes as prices hover near
7-1/2-month lows and demand worries continue to grip the global
market among stiff competition from synthetic fibers and swollen
inventories, particularly in China.
Cotlook slightly reduced its forecasts for demand in key
regions in Asia, but left its forecast for consumption in China
at 7.35 million tonnes, unchanged from the prior month forecast
and from 2014/15.
The reduced outlook for demand offset lower production
expectations. World production will total 23.3 million tonnes,
down from a prior forecast of 23.35 million tonnes and down from
25.54 million tonnes last year, Cotlook said.

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