Acreage Preview: Cotton To Climb

March 22, 2018 09:58 AM
 
 

Analysts agree a myriad of factors including weather, a new safety net program and the market prices of wheat and peanuts will push cotton acres over the 13 million mark in 2018.

The most recent USDA estimate shows farmers will plant 13.5 million acres of cotton in 2018. Private estimates are lower than USDA’s estimate for the most part but still land above the 13 million mark.

While some parts of the country will see farmers jump to plant more cotton, others will stick to their crop rotation plans. Still, a combination of factors are likely to push cotton acres higher than they’ve been in years.

  1. A new safety net program. Thanks to the Disaster Aid Relief package Congress passed in January, cotton is now included in the ARC and PLC programs under Title 1 of the Farm Bill. Cotton had long-been one of the commodities most encumbered by lack of safety net as the crop can be fickle and prone to severe weather damage. “I think the safety net program is fair,” says Ashley Arrington, a farm business consultant with AgriAuthority. She says in her home state of Georgia a lot of producers are taking another look at cotton because of the program changes.
  2. Cotton will steal peanut acres. Peanuts have always had a strong safety net program. In large portions of the south peanuts and cotton compete for the same acres. Arrington says the addition of the safety net for cotton will shift some acres away from peanuts. “We haven’t met a farmer yet that would rather get their money through government payment than through the market,” she says. “They are no longer going to be farming peanuts for payment, they are going to be farming for market, and right now market cotton prices are more competitive than peanuts.”
  3. Wheat prices will push growers to plant cotton. In Kansas, Oklahoma and the panhandle of Texas, the wheat market is pushing farmers to plant cotton, says John Payne of This Week In Grain. The National Cotton Council expects cotton acres to grow more than 76% in Kansas and Oklahoma. “I’ve got producers I work with in Southwest Kansas who are going to be planting circles of cotton,” Payne says. “It’s what’s making money for them. A lot of producers have thrown the towel in on wheat, and corn isn’t that attractive right now either.”

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Comments

 
Spell Check

Rick
Jonesboro , AR
3/27/2018 11:47 AM
 

  The new safety net for cotton will not help the Johnny come lately cotton farmers. They will have no base acres to be paid on.

 
 

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