Today at the 2008 National Cotton Outlook Conference, industry insiders stated that cotton will remain the most profitable large-scale irrigated crop in Australia, and now the cotton industry has begun to fight drought. In the next two years, cotton prices are expected to increase slightly, because consumer demand is strong and U.S. cotton production is reduced. The Australian Bureau of Agricultural Resources and Economics (ABARE) predicts that in 2008-09 and 2009-10, the CotlookA index price will be 76 US cents per pound, compared to approximately 71 US cents this fiscal year. The Cotlook index will increase to 77 cents in 2010-11 and drop by 3 cents in the second year. Global consumption will increase to 30.4 million tons in 2012-13, an increase of 4 million tons from the 2004-05 peak. Consumption is expected to increase by 25% over the same period, mainly due to rising incomes in developing countries. ABARE expects that the output of Australian lint cotton will reach 719,000 tons in 2012-13, and the planting area will be 351,000 hectares. In contrast, next year’s output is expected to be 497,000 tons.