World year-ending stocks of cotton are projected to decrease by eight per cent. This represents about 86 per cent of world cotton consumption in July to June of 2015-16. This is the first reduction in world ending stocks since 2009-10.

Interestingly, the fall in end of season stock is estimated due to lower crop and is not supported by demand which is also falling. There are two reasons for falling demand. One is the lower price of polyester, an alternate fiber, which has also fallen significantly following a sharp fall in crude oil prices. Many users including its biggest cotton consumer China have shifted to that manmade fiber.

Second China’s demand for cotton is also falling and most other cotton producing nations have experienced a similar trend. The development has also changed global equations in cotton consumption with countries like Vietnam and Bangladesh who have seen a spurt in cotton consumption.

World cotton consumption is projected to decrease by two per cent. Cotton consumption in China, the world’s largest consumer, has declined continuously since 2009-10. In 2015-16, cotton consumption in China is expected to be down five per cent from last season. India’s cotton consumption is expected to decline by two per cent.