ICAC Forecast: Slight Decline in Global Cotton Production and Trade in the 2026/27 Season
According to the International Cotton Advisory Committee (ICAC)'s June 2026 report, 'Cotton This Month', a marginal decline in global cotton area, production, and trade is anticipated for the 2026/27 season. The report attributes this to weak demand, rising production costs, and changing climatic conditions in major cotton-producing regions.
According to ICAC estimates, the global cotton area is projected to contract by 1 percent, settling at 30.1 million hectares. Production is estimated to decline by 2 percent to 25.7 million tonnes, while global trade is expected to shrink by 1.4 percent to approximately 9.5 million tonnes.
According to the report, fertilizer prices rose by approximately 12 percent in early 2026—primarily driven by tensions in the Middle East and supply disruptions in the Strait of Hormuz. Furthermore, adverse weather conditions in several countries are also impacting cotton production. In the United States, a significant portion of the cotton crop is under the threat of drought; Australia is grappling with a severe water crisis; and in Pakistan, pest infestations and erratic weather continue to pose challenges to production. Meanwhile, increasing competition from rival crops—such as maize—and from synthetic fibers is also exerting pressure on the cotton sector.
In terms of country-specific estimates, China is expected to retain its position as the world's largest cotton producer. However, a 0.5 percent decline in cotton area and a 4 percent drop in production are projected for the country, which could see production levels settle at approximately 7 million tonnes. Favorable weather conditions and high productivity are expected to sustain China's strong standing.
In the United States, the cotton area is projected to shrink by 6 percent to 2.9 million hectares, while production is expected to decline by 4 percent to 2.8 million tonnes. Despite this, a marginal increase in both productivity and exports is anticipated.
Following four consecutive years of growth, both cotton area and production in Brazil are projected to experience a decline. Production is expected to fall by 10 percent to 3.8 million tonnes. On the other hand, India continues to remain a leader in terms of cotton acreage. Due to forecasts of a normal monsoon, domestic production is expected to increase by 8 percent, with the majority of this output likely to be utilized for domestic consumption and yarn exports.
In Australia, production is estimated to stand at approximately 937,000 tons due to drought and limited irrigation resources; meanwhile, in Pakistan, production could decline by 18 percent—falling to around 900,000 tons—owing to poor seed quality, pest infestations, and adverse weather conditions.
The ICAC has projected the Cotlook A Index for the 2025/26 season to range between 75 and 80 cents per pound, with a midpoint of 78 cents per pound. The next issue of the report is scheduled to be released on July 1, 2026.
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