Australian cotton prices boom in world slump
A FREAK position in the market means that Australian cotton industry is seeing a boom while the world market heads towards a slump, reports the Financial Times.
Austrialias cotton growers are benefiting from several factors, including the weak Australian dollar, the fact that Australian cotton is priced against US cotton futures, and the inflation in US cotton futures caused by the US Governments record subsidy regime.
Australian growers are selling cotton from 1999 and 2000 for more than A$600 a bale – double the cash costs of production.
The Australian Bureau of Agricultural and Resource Economics forecasts a record crop of 700,000 tonnes in 1999.
- Financial Times 03/12/98 page 40