There could be a cotton shortage next year as US farmers are choosing to use more land for wheat, corn and soybeans, saying these crops cost them less to produce and earn them more at market.

As a result the International Cotton Advisory Committee (ICAC) in Washington, which represents 44 cotton-growing countries, believes global cotton output will fall 2.3% over the next 12 months to 25.4 million tonnes. This will lead to the largest annual shortfall in five years, the organisation has forecast.

Ironically, though, worldwide demand for cotton is on the up, thanks to growth in developing economies, especially those of China and India. The ICAC believes consumption will rise by 2.7% in the next year to 27 million tonnes.

This situation has led some speculators to regard cotton as a great investment.