The U.S. cotton industry’s 2024 economic outlook is influenced by several key factors, according to National Cotton Council economists. The global economy’s significant uncertainty has characterized the past year as a time when the anticipated recovery in cotton demand has been slow to materialize. This weak demand has led to pressures throughout the supply chain. The industry will need to closely monitor these factors to navigate the economic landscape effectively in the upcoming year.
Dr. Jody Campiche, the NCC’s vice president of Economics & Policy Analysis, analyzed the NCC Annual Planting Intentions survey results and projected that 2024 U.S. cotton acreage is expected to be 9.8 million acres, which is 3.7 percent less than in 2023. Growers are encountering challenging planting decisions as current prices do not meet the production costs for many producers. This scenario underscores the economic pressures facing cotton growers and the importance of strategic decision-making in the industry.
- In the 2024/25 marketing year, U.S. mills are expected to consume 1.85 million bales, up from 1.75 million bales in 2023/24.
- U.S. textile manufacturing sector continues to experience pressure from weaker Western Hemisphere trade, driven partly by concerns over increased U.S. textile imports under de minimis provisions. The closure of eight U.S. textile manufacturing facilities from August to December 2023 further underscores the challenges faced by the sector.
- World cotton consumption is projected to grow by 2.6 percent to 115.3 million bales in the 2024/25 marketing year. This growth, coupled with a larger U.S. supply, leads to a higher U.S. export projection compared to 2023/24.
- U.S. ending stocks are forecasted to slightly increase to 2.9 million bales in 2024/25, reflecting the dynamics of supply and demand in the global cotton market.
- Consequently, the price ratios of cotton to corn and soybeans were higher than in 2023, which typically indicates a potential increase in cotton acreage based on historical price relationships. However, the 2024 crop year may deviate from this historical relationship due to high production costs relative to current prices, which could impact acreage decisions for cotton cultivation.
