Exploring Potential Growth in End-Use Demand in China and India

The last two decades brought unprecedented growth in the world’s economy. An effect of the tremendous economic growth has been the addition of millions to the world’s consumer class. With the world having more people with more money, there has been increased demand for a range of commodities. Cotton is among the commodities to have experienced a significant increase in consumption over the past two decades. Even with lingering effects of the recession, world consumption of cotton in 2011 is expected to be 33% higher than it was in 1991. Much of the most recent growth in end-use consumption has taken place in emerging markets. Given that expectations are these developing economies will continue to have some of the strongest rates of economic growth in coming decades, it is important to understand what the growth potential might be for cotton end-use in these markets. Two countries that may offer the greatest potential for growth are also those with the world’s largest populations, China and India. The purpose of this research is to investigate these markets. As a prelude to discussion of statistical analysis, this research provides an overview of each country, examining shifts in demographic and economic conditions in these countries over the past two decades and highlighting how this may relate to changes in demand.