Washington DC (BBN)– The cotton market has faced continued uncertainty due to the escalating US-China trade war, with prices under additional pressure due to a projected increase in global stocks.
There is some hope that American and Chinese representatives might be able to de-escalate the conflict later this month when they’re together at the G20 Summit in Osaka, Japan, International Cotton Advisory Committee (ICAC) said in its latest update, released on Monday.
However, the US government recently announced it will provide $16 billion in additional support to its farmers, potentially indicating plans for a prolonged standoff.
Prices have suffered from the escalating tariffs, dropping to a season-low of 76 cents per pound on May 14th.
Although global consumption is expected to rise by 1.0 per cent, production is expected to jump 7.0 per cent, with the resulting increase in global stocks exerting further downward pressure on prices.