Market Outlook


By Ben Potter

India Emerges As World’s No. 1 Cotton Producer

With the U.S. and China both reporting double-digit acre reductions in cotton for 2015/16, India is anticipated to take the crown as the world’s No. 1 cotton producer, USDA announced this summer.

Together, China and India produce more than half of the world’s cotton crop. India’s share of production could rise to 26.5%, with a crop forecast at 29.5 million bales.

India’s “cotton climb” has been steady for the past decade. It surpassed the U.S. as the world’s No. 2 cotton producer in 2006. China has held the No. 1 title since 1982.

China’s rising wages and increasing production costs partly explain the country’s cotton decline, USDA says. In India, the rapid adoption of biotechnology largely has fueled their recent growth.
When India approved Bt cotton in 2002, it was a net importer of the commodity, but today’s landscape is rapidly different because of that decision, explains Denise Dewar, executive director for plant biotechnology at Belgium-based CropLife International.

“Anywhere the technology has been introduced, farmers have really run with it,” she says.
Also in the top five in world cotton production are Pakistan and Brazil. 

By Alison Rice

Cash Rents Hinge on Location

Most everyone has an opinion about where cash rents are headed, but location and landlords are two keys.
In the Federal Reserve Bank of St. Louis district, rents are easing.

Quality farmland rents in the region fell 6.4% during the second quarter of 2015 compared with a year earlier, the bank reports. The bank serves all or part of seven states including Illinois and Indiana.
As for landlord activity, farmers have little reason to expect significant rate changes, says Paul Pittman, CEO of Farmland Partners.

“Our perspective is that under virtually any economic scenario, we will either have flat or increasing rents,” he says.

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