India Topples China As World Leader in This Area

New York: India will be the world's No. 1 cotton grower this year, ousting China from the top spot for the first time in over 30 years, the US government said on Thursday.

If the projections by the US Department of Agriculture (USDA) are accurate, it will mark the end of China's dominance of the global cotton market.

The switch by the two top growers had been expected after Chinese farmers cut plantings amid uncertainty over the state support program and a planting frenzy in India since August after a late monsoon favored growing conditions.

In its report on Thursday, the USDA hiked its estimate for India by 1 million bales to 30 million 480-lb bales of cotton for the 2014/15 crop year that began on August 1.

That would be down from the country's estimated 2013/14 output of 31 million bales, but high enough to propel the country into top spot for the first time since USDA records began in 1966.

The end of China's dominance comes as Beijing scraps its stockpiling program. The state reserve's purchasing has supported the country's farmers and boosted global prices for the past three years.

It also comes as the country's textile industry loses its competitive edge with soaring labor and raw material costs forcing some yarn makers to shift production overseas.

While China's acreage is expected by many traders and analysts to be on a long-term downtrend, farmers in India may be protected by government support programs.