OREANDA-NEWS. February 20, 2015. Global cotton production will fall to 23.9 million tonnes in the 2015/16 crop year, more than 450,000 tonnes lower than estimated 2014/15 output, industry analysts at Cotton Outlook (Cotlook) said in a report on Thursday.

The drop was broadly expected as low prices push the world's farmers to other, more profitable crops, and will result in a 41,000-tonne drawdown in world stocks, the first annual decline since the 2009/10 crop year.

The report forecast that consumption would grow to almost 24 million tonnes in the 2015/16 season, which begins Aug. 1, up 1.4 percent from the prior year.

The projected production drop is driven by an expected decline in output in China, the world's top consumer of cotton, to 5.7 million tonnes from 6.4 million tonnes in the prior year, Cotlook said.

Production in the United States, the world's leading exporter, is seen dropping to 3.1 million tonnes from 3.5 million tonnes in 2014/15.

The decline in production comes as a global oversupply of fiber has driven prices on ICE Futures U.S. to near 5-1/2-year lows, reducing the incentive for farmers to devote acreage to cotton.

This month, the National Cotton Council forecast that U.S. farmers would reduce plantings to 9.4 million acres of cotton, down 15 percent from the prior year and the lowest since 2009, due to weak prices. The sharp drop in planted acres is expected to reduce production.

A Reuters survey found that analysts, traders and farmers, on average, expected U.S. farmers to plant 9.74 million acres of cotton.