Australian cotton is forecast to become the third most valuable export after wheat and beef, which in a year also saw record export results in a month. Official figures from the Australian Department of Agricultural and Resource Science and Economics (ABARES), reveal that in January 2022, nearly $866 million in cotton had been exported alone—nearly double the entire amount of cotton exported in 2020—just two years earlier. “In the calendar year 2020, $455 million of cotton was exported to various overseas markets. That is reflected in drought-affected output in 2019–20 of less than 590,000 bales, which is the worst result in recent history,” Cotton Australia CEO Adam Kay said in a press release.
Kay said drought in stark contrast to flooding makes it difficult to remove the 21/22 crop, which also means significant damage from downgrades in some areas and makes 22/23 cultivation even more difficult, leading to winter losses. “Our thoughts are with all growers who are facing losses and hardships,” he added. ABARES figures show that $1.9 billion worth of cotton was exported in 2021; however, from January to August 2022, $2.046 billion was exported, representing 562,270 tons.
Our forecast for the 2022 crop is around 5.2 million bales and we exceeded that number with a result of 5.5 million. What we are seeing here is the result of some delays in harvesting due to wet weather, and also some previous issues with the availability of shipping and containers. The good news is that bottlenecks and container shortages are showing signs of easing and that will make it easier to get our cotton to different overseas markets,” Kay said.
Our efforts towards resolving backlogs and overcoming challenges, coupled with our international marketing of cotton through Australian Cotton Association members, have seen export forecasts for 2022/23 reach $7.0 billion. However, that is expected to decrease due to flooding across many developing areas, delaying picking and planting.
The third-ranking for the value of exported goods, after wheat and beef, is the highest ranking for cotton since 1988 and coincides with a time when livestock exports fell due to lower prices of red meat and wool. ABARES has also released export figures per country with some surprising results. In the first three months of the 22/23 season, more than $2.212 billion of cotton was exported to 17 countries, while in the entire 21/22 season, the total export turnover was $2.228 billion.
Bangladesh nearly doubled its 2022 imports of Australian cotton to $171 million in the first three months of this season while India imported $110 million more than last season. Other countries that recorded significant increases were South Korea, Malaysia, Thailand,d and Turkey. While global growth expectations have been lowered due to widespread inflation, a sluggish Chinese economy, and falling consumer demand, Australian cotton remains in high demand due to reduced quality and crops due to drought in the US and floods in Pakistan.
Posted on 17/11/2022
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