Global cotton production for the coming year is expected to drop 4 percent, according to estimates by the US Department of Agriculture.
The projected decline is attributed to a significant reduction in Brazil, where the crop for the 2012-13 year is expected to fall by fully one-third.
Record soybean and corn prices, disease outbreak and erratic precipitation are expected to lower the crop in the central Brazilian states of Bahia and Mato Grosso, which together account for more than 80 percent of Brazil’s total annual cotton production, according to Southeast Farm Press.
In the US, production is expected to be slightly more than 17 million bales, which represents a 2 percent increase from the previous month’s USDA estimate and is 11 percent higher than the previous year’s crop, the publication added.
Worldwide, 2012-13 cotton production is estimated at nearly 120 million bales.
Global cotton stocks are expected to be significantly higher this year than last, the USDA also reported.
The depth and breadth of the New York Times’ Disunion series never ceases to amaze. The articles focus on the War Between the States, but go far beyond examinations of battles and leaders, delving into an amazing array of topics, including the medical, legal and financial aspects of the 1861-65 period.
Recently, Disunion, which is written by a variety of historians, academics and other individuals knowledgeable on specific aspects of the war, focused on the ingenious concept of cotton bonds, financial instruments issued by the Confederacy in 1863.
In January of that year, the Confederate Congress secretly authorized bankers at the noted Paris-based financial house of Erlanger et Cie. to underwrite $15 million of Confederate bonds, to be denominated in British pounds or French francs.
“But unlike ordinary bonds backed only by the faith and credit of the issuing country, at the option of the holder an Erlanger certificate could be converted into a receipt for a pre-specified quantity of cotton,” Phil Leigh writes for Disunion.
This was important because Confederate currency was all but worthless in Europe at that point of the war.
The conversion rate for the cotton bonds was fixed at 12 cents a pound, regardless of the commodity’s market price, at the time about 48 cents. In addition, the bonds paid a 7 percent annual interest rate.
Last year proved a solid one for nearly all cotton farmers except those in Texas and Oklahoma.
While states in the South and West registered overall harvest rates of 97 percent or better, Texas farmers lost 40 percent of their crop, more than 2.5 million acres, according to the US Department of Agriculture.
Oklahoma growers planted a smaller amount of cotton than their counterparts in Texas, but lost nearly half their crop, hurt by drought conditions that hit the region.
Overall last year, 12.3 million acres of cotton were planted in the US, and 9.4 million acres were harvested, according to the USDA.
Texas farmers planted more than 6.5 million acres of cotton but were only able to harvest 3.9 million acres. And the yield was just 600 pounds per acre in the Lone Star State, off from the five-year average of 700 pounds.
In Oklahoma growers planted 305,000 acres but only harvested 140,000 acres. Yield per harvested acre was just 480 pounds, down from a five-year state average of 770 pounds.
What follows took place during the presidency of Chester A. Arthur, but when one happens across stupidity of a colossal nature – no matter how long ago it occurred – it deserves to be recognized.
A Sumter, S.C., newspaper called the Watchman and Southron in November 1881 detailed the story of a Georgia man who had $400,000 in Confederate bonds in his possession. He’d purchased them during the war and was being offered 5 cents on the dollar for them, which was probably not an unreasonable offer at the time.
At that price, the individual could have realized about $2,000 in US money, no small amount in those days, particularly given the overall state of the Southern economy less than two decades after the close of the War Between the States.
No deal, however.
The man responded to the offer by stating that he was not only not interested in accepting 5 cents on the dollar, he wanted full value.
“I have a part of a wagon load of Confed. securities but am holding them for $1,000 per thousand,” he wrote in late 1881. “I expect that one of these days that my children will get the full amount of my Confed. money back, together will all my bank stocks. More unpromising things have come to pass.”
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.
Cotton futures are proving a real gamble at present, with prices spiking and plummeting from one day to the next.
Last week wild price swings were the norm as future prices jumped 12.5 percent in a one-week period before falling back.
Spot December cotton futures hit a five-month high of more than 79 cents a pound last Thursday amid growing concerns about “tight nearby supplies of tenderable qualities and low stocks in deliverable position,” according to the Lubbock (Texas) Avalanche-Journal.
March futures were up nearly 6 percent for the week, closing at 75.43 cents, the publication added.
The upturn in prices is somewhat surprising given the lackluster export sales of cotton due to decreased production worldwide and enormous world stocks in countries such as China, according to Southeast Farm Press.
Few scenes capture the spirit of the South more clearly than fields of ripening cotton, so thick with fluffy bolls that the whiteness dazzles the eye.
Farm Press understands the charm of cotton and is again asking readers to grab their cameras and capture the picturesque crop in all its splendor.
For the second straight year, Farm Press, which publishes Southeast Farm Press among other publications, is looking for photos that “recognize the beauty of cotton and the people who grow it.”
“Cotton is a huge part of Southern farm culture … snow-white fields ready for harvest hold promise of a good return for hard work and perseverance,” writes Slate Canon on the Farm Press Blog. “And from the time the first seedling pushes through the soil, to first bloom, to boll fill and finally to the massive pickers marching through fields leaving brown swaths in the white landscape, a cotton crop is a work of art.”
Farm Press is asking readers to send in their best cotton photos – kids in cotton fields, blooms, sunsets, pickers and strippers, anything that captures the uniqueness of cotton – to email@example.com by Nov. 1.