Lack of rain hurting US cotton projections
The uncertainties of farming have been made apparent to cotton growers this spring. Cotton prices remain among the highest on record, but a lack of rain is hindering growing conditions and will likely put a crimp in yield.
The US Department of Agriculture recently reduced expected US cotton production by 1 million bales to 17 million bales, due largely to drought conditions across the South.
According to Southeast Farm Press, the reduction is mainly the result of expected higher abandonment resulting from the increased severity of the drought, particularly in Texas.
Exports were reduced 500,000 bales to 13 million bales. Forecast consumption by China was reduced 500,000 bales, as the recent slow pace of imports indicates sluggish demand now and early in the new marketing year, the publication reported.
In Texas – where about half of the U.S. cotton area is located – conditions have been extraordinarily dry as the US Drought Monitor indicates that 94 percent of the state is experiencing a “severe” drought or worse, according to the USDA, which added that in the High Plains of Texas – where two-thirds of the Texas cotton area is located – drought conditions are considered the most severe.
Rainfall there has been limited this year with only 1.2 inches recorded through May, compared with a long-term average of 6.5 inches.
The January-May 2011 rainfall total is the lowest since records began in 1895 and about half of the next highest amount recorded in 1996, the government agency reported.
As of June 5, 87 percent of the expected cotton area had been planted, slightly below last season but equal to the five-year average.
“With the June projection, the U.S. cotton yield remains forecast at 800 pounds per harvested acre, as the reduction in production was associated with the expected loss of area to be harvested,” the USDA reported. “The 2011/12 yield projection is 12 pounds below the 2010 season and 19 pounds below the 5-year average.”
Based on the latest supply and demand estimates, the forecast for the 2011/12 U.S. average farm price is projected to range between 95 and 115 cents per pound. The comparable price for 2010/11 is estimated between 81 and 83 cents per pound, following a 62.9 cent farm price for 2009/10, the agency added.