The report projects global cotton area to decline by 1 per cent to 30.1 million hectares in 2026-27, while world cotton production is forecast to fall 2 per cent to 25.7 million tonnes. Global cotton trade is also expected to decrease by 1.4 per cent to around 9.5 million tonnes.
ICAC said higher fertiliser costs, competition from alternative crops and environmental pressures are reshaping planting decisions across major producing countries. Global fertiliser prices rose more than 12 per cent in the first quarter of 2026 due to geopolitical tensions in the Middle East and disruptions to trade flows through the Strait of Hormuz.
China, the US and Brazil are expected to reduce cotton acreage in 2026-27 as rising input costs, weak profitability and weather-related challenges weigh on planting decisions, according to ICAC.
Global cotton area, production and trade are all forecast to decline, while India is projected to buck the trend with an 8 per cent increase in output supported by a normal monsoon and stronger demand.
China, the world’s largest cotton producer, is expected to reduce cotton area by 0.5 per cent to 3 million hectares and production by 4 per cent to 7 million tonnes. The decline reflects efforts to remove lower-efficiency and water-stressed farmland from cotton cultivation. Despite the reduction, favourable weather conditions are expected to support a yield of 2,421 kg per hectare, among the highest globally.
In the United States, planted area is projected to decline 6 per cent to 2.9 million hectares, resulting in a 4 per cent drop in production to 2.8 million tonnes, the lowest level in three seasons. The report noted that drought-like conditions affect 98 per cent of the US cotton crop, raising abandonment risks, although El Niño-related weather patterns are expected to support slightly higher yields. US cotton exports are forecast to increase by 3 per cent.
Brazil is also expected to reverse its recent expansion trend. After four consecutive seasons of acreage growth, cotton area is projected to contract by 6 per cent to 2 million hectares, leading to a 10 per cent decline in production to 3.8 million tonnes. The reduction is concentrated in Mato Grosso, where higher fertiliser costs, soft global demand and strong competition from corn have reduced cotton’s profitability.
India is expected to remain the world’s largest cotton-growing country by area, with cultivation steady at 11.8 million hectares. Production is forecast to increase by 8 per cent on expectations of a normal monsoon. ICAC said additional output is likely to be absorbed by rising domestic consumption and strong cotton yarn exports, particularly to China.
Elsewhere, Australia is forecast to reduce cotton area and production by 10 per cent due to extreme dryness, limited irrigation water and elevated input costs. Pakistan’s production is projected to decline 18 per cent despite stable acreage, as farmers continue to grapple with poor seed quality, pest pressure and erratic weather.
The ICAC Secretariat forecast the Cotlook A Index for the 2025-26 season in the range of 75-80 cents per pound, with a midpoint of 78 cents per pound.
Fibre2Fashion News Desk (CG)
