According to a latest report by International Cotton Advisory Committee (ICAC) subsidies provided to the cotton sector, including direct government support to production, border protection, crop insurance subsidies, and minimum support price mechanisms are estimated at a record $10.4 billion in 2014-15 compared to $6.5 billion in 2013-14.

Subsidies to the cotton sector in one form or the other were provided by 12 countries, viz. China, India, Turkey, the US, Greece, Brazil, Spain, Mali, Burkina Faso, Colombia, Ivory Coast, and Senegal during the 2014-15 season. As per the report, these subsidies averaged 22 cents per pound, up from 15 cents per pound in 2012-13.

There has been a strong negative correlation between subsidies and cotton prices since 1997-98, when the ICAC Secretariat first began reporting on government measures in cotton. Subsidies tend to dip in years when prices are high, and when they are low, subsidies tend to rise. The report stated that this relationship was maintained during 2014-15 as well. The Cotlook A Index declined from an average of 91 cents per pound in 2013-14 to an average of 71 cent per pound in 2014-15, and subsidies provided to cotton growers increased.

Minimum support price programmes were triggered during 2014-15 because market prices fell below the government intervention prices, in some countries such as India and Brazil. While some other countries provided subsidies for cotton inputs in 2014-15.