NSW Department of Primary Industries

Cotton

  • GVP up 1% to $2.37 billion est.
  • Exports totalled $2.9 billion in 2023-24
  • China’s share of global imports reached 34% in 2023-24, up from 17% in 2022-23
Production increased by 4% year-on-year, to total 761 thousand tonnes for 2023-24. This was achieved despite mixed seasonal conditions occurring between southern and northern growing regions, with the south avoiding a repeat of the wet conditions that impacted the prior 2022-23 season, while northern growers dealt with dry growing conditions and subsequent rain interruptions at harvest.

In Australian dollar terms, Australian cotton prices were relatively stable down just over 2%. Australian exports were strong and accounted for 13% of the international export trade. China returned to become a major market for Australian exports and the second largest market in 2023-24, following several years of trade disruption.

The outlook for cotton is influenced by a consumer slowdown in major economies which is impacting demand for cotton products. Global production has remained relatively stable. Locally, water storages across many cotton growing regions remain supportive for producers although the relative profitability of alternate summer crops such as sorghum have been flagged as key determinants for cotton growers planting programs in the year ahead.

Production

Production is expected to be almost 4% higher year-on-year at 761 thousand tonnes for 2023-24, the second highest production year and only 9% lower than the record achieved in 2021-22. The estimated total area harvested remained broadly unchanged at 337 thousand hectares from the prior year, including both irrigated and dryland. The average yield from the total area harvested increased to an estimated 9.9 bales per hectare, just over 4% higher than in 2022-23 and 12% higher than the 10 year average. 6 In general production has been supported by favourable commodity pricing and water availability for irrigation.

Seasonal conditions for the southern and Macquarie regions supported growth through the season which was followed on with improved picking conditions compared to the wet conditions experienced in 2022-23.

Some northern crops were impacted by a drying trend through the growing period with subsequent picking interrupted by rain events leading to some delays in harvesting and quality impacts. 83 Consistent with these regional conditions area harvested in the southern and Macquarie regions were estimated to have lifted by 66% and 50% respectively year-on-year, while the area harvested in the northern growing regions were between 4% and 30% lower than in 2022-23. The share of dryland cotton on an area planted basis for these northern regions ranged from an estimated 37% in the Namoi Valley to 42% for Walgett and Bourke region in 2023-24. 48

NSW Cotton Production and Yield

  • Production
  • Yield (RHS)
Download data (.XLSX)
Source: ABARES (2024)

Estimated regional cotton production

  • Mungindi
  • Gwydir
  • Namoi
  • Macquarie Valley
  • Walgett & Bourke
  • Southern Valleys
Download data (.XLSX)
Source: Cotton Australia (various issues)

Price

Cotton
Global cotton prices eased in 2023-24 from the prior year with the global benchmark price (Cotlook A index) averaging 93.4 US cents per pound, 8% lower year-on-year, and almost 30% lower than the record price received in 2021-22 when international cotton prices peaked. Lower global prices have reflected lower economic activity in key markets capping demand for cotton products at the same time as global production has been relatively stable. 6

In 2023-24 the average Australian cotton price decreased by just over 2% to average 287 cents per kilogram with the Australian price showing more resilience than the global benchmark price. While the Australian price has slipped 13% from the peak price received in 2020-21, the 2023-24 average price remained 4% higher above the 5-year average which supported grower production decisions. The Australian cotton price has traded at a discount to the Cotlook A index since 2020-21 however, this discount has narrowed in 2023-24 to be just under 9%, compared to a 16% discount observed in 2020-21. 3 50 This discount, since 2020-21, has reflected high Australian production and low United States production over this period. 10

Trade

NSW cotton exports totalled $2.89 billion in 2023-24, marginally eclipsing the record level of $2.87 billion achieved in the prior year. Notably, Australian exports to China recovered strongly to become the second largest market by value representing 27% of exports in 2023-24. Unofficial trade barriers impacted exports to China from 2020-21 which saw Vietnam replace China as Australia's largest market for cotton. Despite the recovery in exports to China, Vietnam remained the top export destination and accounted for a third of total cotton exports in 2023-24. 78 Globally, trade was supported by China’s cotton imports which increased in 2023-24 as it worked to replenish its cotton reserves. As a result, China’s share of global cotton imports jumped from 17% in 2022-23 to 34% in 2023-24. 145

On the supply side US production in 2023-24 was impacted by drought conditions in the southwest especially Texas, resulting in reduced exports with its share of global trade falling from a 3-year average of 33% to 26% in 2023-24. At the same time record surplus production in Brazil, supported by a substantial 16% increase in the area planted, meant Brazil increased their cotton export volumes by 85% year-on-year. This saw Brazil eclipse the United States as the largest exporter of cotton by volume in 2023-24, while Australia was the third largest exporter in volume terms accounting for 13%. 143 145

Cotton’s share of global fibre production by volume was about 20% in 2023, while synthetic fibre represented 71%. Polyester in particular, accounting for 84% of synthetics production in 2023. 133 Since the mid-2000s cotton prices have generally increased relative to polyester price, at the same time cotton consumption has remained relatively flat with growth in fibre production being met through higher polyester production. 87 133

Australian Cotton Exports by Value

  • Vietnam
  • China
  • Indonesia
  • Bangladesh
  • Malaysia
  • India
  • Türkiye
  • RoW
Download data (.XLSX)
Source: S&P Global (2024)

China and Rest of World Cotton Imports

  • China
  • RoW
  • China's share (RHS)
Download data (.XLSX)
Source: USDA (various,a)

Outlook

The current consumer slowdown in major economies is expected to continue to impact consumer demand for cotton products. However, production outcomes amongst key producers such as the United States, Brazil, China and India remains a critical determinant of cotton prices in the shorter term which are typically sensitive to global production risks. 24

Relatively full water storages across much of the state in 2023-24 are supportive of crop production, while price expectations for cotton as well as the profitability of alternate summer crops such as sorghum have been flagged as key determinants for cotton growers planting programs in the year ahead. 6

DPIRD Initiatives in Focus

Forest biosecurity team - keeping a close eye on forest and tree health

DPIRD’s Forest Health team plays a critical role in monitoring the State’s forests and trees for pest and disease risks and incursions. The team, coordinates a statewide program including early-detection surveillance and response to suspect detections, as well as undertaking stakeholder engagement to improve detections, to keep the State’s $3.3B forestry industry healthy.

Forest

DPIRD’s Forest Health team continues to play a critical role in monitoring the State’s forests and trees for pest and disease risks and incursions. As the forest biosecurity lead in NSW, the team coordinates a statewide program that includes early-detection surveillance and response to suspect detections. They work to protect plantations (softwood and hardwood), native forests, and amenity forests.

Led by Dr Angus Carnegie, the team has experience and expertise in biosecurity surveillance and systems and processes and works closely with DPIRD’s Plant Biosecurity group. Since 2014, the Forest Health team has been conducting forest biosecurity surveillance for early detection of exotic pests and diseases that can threaten our plantations, amenity trees and native forests.

The Forest Health team conduct annual forest health surveillance of NSW's softwood and hardwood plantation estate for Forestry Corporation of NSW. This includes aerial and ground surveys mapping the extent and severity of damage from a range of damaging agents including insect pests, fungal diseases, invertebrate pests, weeds, nutritional imbalances and climatic disorders, and advising on pest management including biocontrol.

The team also undertakes stakeholder engagement to improve early detection and reporting of exotic pests. Research by Forest Health has shown that the public detect many new exotic pest arrivals, and mostly in urban areas on amenity trees. The team conduct training workshops providing information about "what to look out for" (signs and symptoms) and "how to report" with a range of stakeholders, including local councils, arborists, golf courses and botanic gardens. A specific program focuses on training Indigenous Rangers in forest health and biosecurity surveillance.

A range of fact sheets (see Protect what we love) have been developed to assist in early detection of invading exotic pests of trees. Forest Health were also instrumental in the development of a relatively new app for field diagnosis and reporting of pests and diseases (MyPestGuideTrees)

Collaboration is a key focus for the team. For example Forest Health continues to work with Plant Health Australia, the federal and state governments, and other technical experts to update the National Forest Pest Surveillance Program as part of the National Forest Biosecurity Surveillance Strategy.

The team recently had a research paper published following the detection, response, and surveillance to a suspect detection of Polyphagous shot hole borer in Sydney in 2022. Polyphagous shot hole borer and fusarium dieback are serious threats to Australia’s horticultural industries, amenity trees and native environment. Timely diagnosis determined the pest to be the closely related tea shot hole borer, not polyphagous shot holt borer. The paper describes the biosecurity response effort and highlights the importance of surveillance for early detection of invasive pests, as well as biosecurity systems for enabling a timely response, including timely and accurate diagnosis.

Ongoing surveillance and monitoring is in place to watch out for exotic pests such as polyphagous shot hole borer, which is under eradication in Perth. Importation of timber and timber products is one of the highest risks for exotic pests and diseases coming into Australia. It is likely the main factor in polyphagous shot hole borer coming into Perth. Imported timber is one of the key risk factors we consider when we identify where we do our surveys. It is important to note that any increase in imported timber and timber products would result in an increased need for surveillance at points of entry and increase the risk for exotic pests and diseases coming into our valuable forests.

Another recent example was the suspect detection of an exotic strain of myrtle rust in Sydney. DPIRD Forest Health team conducted extensive surveillance in the Sydney basin and along the east coast, with more than 130 samples collected for diagnosis. Fortunately, this was a false alarm: no exotic strain was detected, only the established Pandemic strain.

Forest biosecurity efforts continue to play a critical role in helping to keep the State’s $3.3B forestry industry healthy, enabling timber and other wood products to be harvested for the construction of homes and other products – many of which we use in our everyday lives. For more information on the Forest Health click here.

www.dpi.nsw.gov.au