The 2012 cotton season overall hasn’t been anything to brag about, but it’s also been nothing to weep over.
While the jury is still out on cotton for this year, from all reports the crop will be good but not spectacular, according to Southeast Farm Press.
The Southeast enjoyed good growing conditions for much of the year, and Texas rebounded nicely from last year’s disaster. However, heat and drought impacted other cotton-growing areas such as Oklahoma.
Production costs have continued to rise, however, and uncertainty in world stocks has kept prices down.
In Texas, the nation’s largest cotton-growing state, the US Department of Agriculture is predicting that the 2012 cotton crop will total 6.1 million bales, a 74 percent increase over 2011, according to the San Angelo Standard-Times.
More than 350,000 acres of Texas farmland was planted in cotton in 2011, but only 18,000 acres were harvested as the state experienced its worst one-year drought since 1895.
The price of cotton futures continue to hover in the mid-70-cents-a-pound range, according to the National Cotton Council. That’s well off records set two years ago.
“Two-bale cotton, even for growers who were able to market half of their crop in the 90 cent per pound range and half at 70 cents a pound will only pull $800 or so per acre,” the publication reported. “Two-bale-per-acre cotton will be hard to come by in most of the Southeast this year as will averaging 80 cents a pound for the crop.”
Prices have been buffeted by uncertainty within the industry. Factors include China’s decision to build up its cotton stocks, making it a big wild card in international cotton trade, according to the Memphis Commercial Appeal.
In addition, cotton farmers have seen costs rise as they’ve been forced to turn to old technology insecticides such as pyrethroids on high-tech, high-priced seed to make up for high-tech failures in weed and insect control, according to Southeast Farm Press.
“Some growers, who are making double passes in their fields with herbicides and insecticides, are looking closely at conventional cotton seed, which sell for $300-400 per bag less than some high-tech cotton seed,” the publication added.
Southeast Farm Press also noted the growing cost of fertilizer as another factor that has cut into cotton farmers’ bottom line.
In the two-decade period between 1992 and 2012 the price of anhydrous ammonia jumped from slightly more than $200 per ton to $785 per ton, for example.
The high cost of production coupled with the low price cotton is bringing in the marketplace means acreage for 2013 could be on the low end as farmers turn to higher yielding crops.
(Cotton behind harvested in Texas. Photo credit: San Angelo Times-Standard.)