India may replace China as the world's largest cotton producer in the next marketing year. The country is expected to produce 39.62 million bales in 2014-15 compared with 40.05 million bales in the current year. In contrast the Chinese crop would be lower in 2014-15 as it has started focusing more on food crops while crop coverage in India could hit a record if the weather remains favorable.
A bumper harvest in India for a second straight year will further pressure global cotton futures, which have already dropped 24 per cent so far this year, as global year-ending stocks are estimated to rise for a fifth straight season. However, Indian cotton exports could drop in 2014-15 as its biggest buyer China is offloading its own inventory and cutting down on purchases from overseas.
Global trade could decline 12 per cent in 2014-15, as Chinese imports could come down by 26 per cent. India is the second largest producer of cotton in the world after China accounting for about 18 per cent of world cotton production. It has the largest area under cotton cultivation in the world ranging between 12.2 million hectares and constituting about 25 per cent of the world area under cotton cultivation. The yield per hectare is, however, the lowest against the world average. Over the last two years it has shown potential to reach world average levels in the near future.