CHICAGO (B)--The International Cotton Advisory Committee raised its world cotton production estimate in its monthly report to 19.01 million tonnes, or 87.30 million bales, compared with its estimate last month of 18.99 million tonnes. The U.S. Department of Agriculture last estimated world production at 86.75 million bales.

ICAC continued to inch higher its 2000-01 world consumption figure, lifting it to 20.04 million tonnes (92.00 million bales), compared with a previous estimate of 20.10 million tonnes. This figure is slightly below United States Department of Agriculture's estimate of 92.57 million bales.

ICAC's ending stocks estimate of 7.69 million tonnes (35.30 million bales) was slightly above its last projection of 7.67 million tonnes and slightly higher than USDA's world carryout estimate of 34.35 million bales.

ICAC estimated the Cotton Outlook A index should average 62.00 cents per pound in 2000-01.

ICAC said that with consumption exceeding production, ending stocks--which declined 1 million tonnes from 1999-2000 to 2000-01--should fall 1.7 million tonnes from 1999-2000 to 2001-02.

As a result, the average Cotton Outlook A index is expected to increase from 53 cents in 1999-2000 to 62 cents in 2000-01, and to 71 cents in 2001-02.

Despite low cotton prices in 1999-2000, world production in 2000-01 is expected to register a slight increase. Increases in the United States (up 300,000 tonnes), Brazil (up 100,000), China (up 70,000) and in 23 other countries will partially offset declines elsewhere. The United States, Brazil and China provide direct subsidies to cotton production.

In contrast, in 1992-93 cotton prices fell to an average of 58 cents, and world production fell to 16.9 million tonnes in 1993-94, a drop of 1 million.

A drawdown in world ending stocks supports the increase in price from January to July, with consumption rising in both importing and exporting countries. Sales during the first two months of 2000-01 have been very active, preventing prices from taking a downward course that normally occurs during the first part of a season.

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