The United States experienced a declining trade surplus in cotton from 1995 to 1999, fueled by decreasing exports to East Asian markets, reports the U.S. International Trade Commission (ITC) in its publication Industry and Trade Summary: Cotton.

The ITC, an independent, nonpartisan, factfinding federal agency, recently released the report as part of an ongoing series of reports on thousands of products imported into and exported from the United States. Following are highlights from the report:

• The United States is an important producer of cotton, supplying approximately 20 percent of world output. Production totaled 3.7 million metric tons in marketing year (MY) 1999, of which 147,000 metric tons was extra-long staple (ELS) cotton. Other major producers include China, India, Pakistan, the Republic of Uzbekistan, Franc-Zone Africa, and Turkey.

• U.S. cotton farming and ginning is becoming increasingly concentrated, while at the same time, total harvested acreage is increasing. In 1969, nearly 200,000 cotton farms harvested 11.5 million acres (4.7 million hectares); by 1997, only 31,456 farms were harvesting 13.2 million acres (5.3 million hectares). Over the last twenty years, the number of domestic cotton gins declined nearly 52 percent, from 2,251 to 1,084. Per acre yields inched upward and costs declined during 1995-99 through the use of transgenic seeds, insect eradication programs, and land management techniques.

• Domestic cotton farmers are supported by a patchwork of government programs designed to stabilize income during severe price volatility, provide timely cash flow, and maintain competitiveness in U.S. and foreign markets. Some of the programs include marketing loss assistance payments, marketing assistance loans, loan deficiency payments, and a three- step competitiveness program.

• The United States remains by far the largest exporter of raw cotton, accounting for 18 percent-27 percent of annual world exports during MY 1995-99. In 1999, the United States held an $832 million trade surplus with its trading partners, down from $2.5 billion in 1998. Major export markets include textile-producing countries in East Asia, such as Indonesia, Japan, Korea, and Taiwan, as well as Canada, Mexico, and Turkey. U.S. imports of cotton in 1999 totaled $136 million, and major suppliers included Greece, China, Syria, Egypt, and Argentina. Imports fluctuated substantially during 1995-1999, varying from a high of $283 million in 1996 to a low of $3 million in 1997. Import suppliers also shifted considerably over the five-year period.

• The U.S. consumers of raw cotton are textile mills that process the fibers into yarns and threads. These intermediate products are then consumed downstream producing hundreds of items, including wearing apparel; home furnishings, such as draperies, upholstery fabrics; towels, wash cloths, sheets, pillowcases; and rugs; and industrial use products, such as medical supplies and industrial thread. Consumer demand for cotton is closely linked to fashion trends, home sales, and competitive pricing vis-a-vis man-made fibers.

The foregoing information is from the ITC report Industry and Trade Summary: Cotton (USITC Publication 3391, January 2001).

ITC Industry and Trade Summary reports include information on product uses, U.S. and foreign producers, and customs treatment of the products being studied: they analyze the basic factors affecting trends in consumption, production, and trade of the commodities, as well as factors bearing on the competitiveness of the U.S. industry in domestic and foreign markets.

This report will be available on the ITC Internet web site at www.usitc.gov. A printed copy may be requested by calling 202-205-1809, or by writing the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may be faxed to 202-205-2104.