On Tuesday, cotton markets hit a major milestone. Adjusted for world price, cotton is at its highest mark since 2012.
When the USDA forecasted a 7 percent cotton acreage increase to 13.5 million acres in its March Prospective Plantings Report, some wondered what the price would do.
It’s a stark contrast between the south and southeastern U.S. and the southern Plains. There are flash flood warnings in parts of the Carolinas, and Storm Alberto made landfall in the Florida panhandle Monday.
In the southern Plains, the Texas and Oklahoma panhandles would welcome that rain. The crop has emerged, and could be at risk of burning up. There isn’t any rain forecasted to fall in the area for the next two weeks.
In the USDA’s last Crop Progress Report, roughly half of the cotton crop had been planted, and Virginia, North Carolina and South Carolina are running behind the five-year average.
“One of the things we are seeing through globally is the fact that cotton demand is increasing again,” said Dr. Gary Adams, president and CEO of the National Cotton Council (NCC). “In the current marketing year, [USDA] has world production around 120 million bales—that’s up about 4 percent from where we were a year ago.”
These strong prices are causing cotton producers to search for equipment. According to Chris Bennett, Farm Journal magazine reporter, smaller growers are having a difficult time to meet their growing acres.
“To get back in the game is super tough,” he said. “That lends itself to the big acreage cotton growers.”
Between the price and the acreage picture going into 2018, Adams is optimistic.
“I think we got the potential to see further growth in consumption,” he said.