WASHINGTON – The international Cotton Advisory Committee (ICAC) is projecting an 11.8 per cent decline in cotton consumption for 2019/20 as demand slumps due to the Covid-19 pandemic. It’s latest report points to a 4 per cent decrease in planted land in 2020/21 and a 4 per cent decrease in production in 2020/21.
Apparel supply chains have reeled under the impact of Covid-19 as brands have cancelled millions of dollars’ worth of orders. However, the impact on cotton agriculture is likely to be equally devastating, and many farmers will be forced to shift to other crops if the situation does not improve soon.
Said a press note from ICAC: “While there is hope for a vaccine or cure, or that warmer weather in the Northern Hemisphere will minimise Covid’s impact, there can be no real economic recovery unless there is a health recovery first. Whether or not we sink into a worldwide depression — a long recession with unemployment reaching as high as 33 per cent — will be determined by the effectiveness of government policies.”
ICAC said that in 2020/21, global area is projected to decrease by 4 per cent to 33 million hectares, with India remaining the world leader despite plantings dropping to 12 million hectares. Production will decline by a comparable amount to 25 million tonnes. The Secretariat’s current price projection for the year-end 2019/20 average of the A Index has been revised to 71.4 cents per pound this month. The price projection for the year-end 2020/21 average of the A Index is 56.9 cents per pound this month.
Formed in 1939, the ICAC is an association of cotton producing, consuming and trading countries.