The latest U.S. Department of Agriculture (USDA) cotton projections for 2013/14 indicate that global ending stocks are forecast to reach a record 96.9 million bales, 8 percent (7.3 million bales) above 2012/13. Stocks have risen dramatically over the last several seasons as cotton prices encouraged higher global production that exceeded mill demand for the fiber. The latest 2013/14 forecast of world cotton stocks indicates that they will have increased by nearly 50 million bales since 2009/10, an unprecedented occurrence.
Policies in China are the major driver of the global stock build-up. For 2013/14, ending stocks in China are projected at a record 58.8 million bales, the third consecutive season of rising stocks (fig. 1). With stocks in the United States declining and those in the rest of the world about unchanged, China is forecast to hold a record 61 percent of global stocks by the end of 2013/14. However, the uncertainty surrounding the retention and disposal of these stocks has supported world cotton prices as global free supplies have declined in recent marketing years.