International Cotton Advisory Committee

Extract

The 21st plenary meeting of the International Cotton Advisory Committee (ICAC) took place in Washington from May 9 to May 23, 1962. In the Committee of the Whole, attention was given to the world supply and demand situation, government actions affecting cotton, and steps needed for the further advance of the world cotton economy. A statement, prepared by a working group headed by Mr. Edouard J. Senn (France), developed from the discussions of the committee, presented the following observations, among others: 1) The overall statistical situation in raw cotton remained strong. Acreage had risen to a new peak; cotton consumption was at a record high level; there had been a reasonable degree of price stability in world cotton markets; and most countries would probably dispose of the bulk of their exportable supplies. World stocks were likely to decline to their lowest level since 1953. The committee recognized, however, that the over-all reduction in cotton stocks in the period under review had been brought about mainly by reason of partial crop failures in certain countries and that, with normal yields in these countries, the relationship between supply and demand could well have been reversed. 2) Cotton consumption continued to break new records with each successive season, but undue optimism had to be tempered by an awareness of the intense competition from the manmade fibers which had brought about a decline in cotton's share of the total textile market. 3) The profit margins of cotton textile manufacturers, as well as of producers, were also limited by rising costs and by the highly competitive nature of the textile industry. 4) In the opinion of the committee there was no doubt that the restriction of acreage in the United States had been a major factor in the orderly liquidation of the cotton surplus and in the return to a better balance between world cotton supply and demand. 5) The committee noted with considerable interest the statement of the United States delegation that attention was currently being given to a number of plans to introduce a greater element of freedom in the manner of cotton production and to reduce or eliminate the differential between domestic and export prices in the United States. 6) The committee also welcomed the reassurance by the United States delegation that in formulating its cotton policy the United States would always have in mind the interests of other nations and seek to avoid any dislocation of the world cotton market.