Cotton Seed Distributors - Web on Wednesday

Update on the US crop from the major US growing regions.

Jeff Gwyn - Mid South
Jeff could you give us a run down on how the crop in the mid-south of the USA is looking this year?

Well I think overall from north to south in the Delta we’re a little bit behind schedule. We had normal and good planting conditions from the mid to the south Delta. Wet, cool late planting conditions in the north Delta, which is a significant portion of our Delta crop.

Some good conditions after planting, good early growth and in June we had a record rainfall for about three weeks and that’s from the north end to the south end which did considerable damage to the crop in terms of water logging, some boll and square shed and some delay of flowering and then the crop recovered after that to a great extent and was moving along quite well until we had a cool spell about the first part of August and kind of shut it down a little bit, so we’re behind but overall I think we’re in for an average crop.

No record yields like we saw last year but I think overall the farmers will be in good shape in terms of yield, but we will need a good, dry, warm fall to carry this crop out to the finish.

What is the average yield in the Delta that you’re thinking you might achieve this year?

Well the average yield for example in Mississippi is about 800 pounds of lint per acre and it varies up and down the Delta but I think that’s probably a good figure for the entire Delta.

Of course some of the farmers in the better situations with supplemental irrigation can typically push two and half/three bales but I guess your average dryland farmer, if he gets one thousand pounds of lint per acre he’s quite happy. Of course this year they would like to have a lot more pounds because there’s a lot less price.

Lee Rivenbark - Texas
Lee could you give us an update on how the crop in Texas is looking at the moment?

Well the overall crop in the southwest is looking above average, you know there’s about 6 million acres plus of cotton in the southwest, an extremely large cotton growing area. In South Texas the crop right now we’re hearing of yields two to three bales to the acre; very, very good year in South Texas.

The fiber length, the fibre strength is yet to be determined but right now all looks well. In the Plains and that’s where over 5 million acres of cotton is planted, a very, very large cotton growing area, optimism is extremely high, probably the best in years – very good crop.

Jeff Klingenberg - Southeast
Jeff could you give me an update of how the crop is looking in the Southeast, mid Atlantic region of the United States?

Sure, the mid Atlantic region consists mostly of the Carolinas and southern Virginia and the southeast region is considered mostly of Georgia, northern Florida and Alabama. This year is probably then one of the best years we’ve had in probably about three or four years in the southeast mid Atlantic.

We began with excellent rainfall for good soil moisture for planting, excellent conditions for planting with temperature and good beginning heat units and then followed up by intermittent rainfalls that were just timed perfectly through the season.

There are a few hot spot like in Georgia, which is considered the southeast portion of the US cotton belt, where in central Georgia there maybe some hotspots where they’re rain deficit, but overall in the southeast mid Atlantic the rainfall has been excellent and it seems to have shut of a little bit at the end of the season here where we’re looking at good boll opening time and earlier crop and a pretty good yield in crop across the southeast mid Atlantic belt. Normally in the southeast mid Atlantic we’re looking at around 1.75 to 2.5 bale average for a season.

This year we’re looking at a pretty good 2 to 2.5 bale average for the season and this is going to be combined with both irrigated and non irrigated cotton this year and that is because of the intermittent rainfalls that have been very timely.

There have been growers that have been using their irrigation systems but mostly to push the crop to high end potential and their using their systems for managing the crop to maintain good boll retention and so forth. So overall this year if you talk to growers in the southeast mid Atlantic they are very pleased with the crop and there are varietal differences that are showing up and we will not know until the end of course as in every year.

Now everybody is keeping their fingers crossed from potential hurricane damage that could come along as it did last year in the Carolinas and things like that but for right now it’s a very excellent crop for the mid Atlantic southeast.

Will Leatherman - US Market
Will, could you give us an update on the US crop and the market and how you see it at the moment?

Well I think the US crop is going to be pretty large, somewhat more than 20 million bales assuming we have a decent autumn. What’s going to happen in Texas is always the big determinant for the US crop. So far the crop looks absolutely wonderful; they’ve had all cool weather the last week or two but they’ve still got a lot of time to grow the crop there. 

If they have a really nice finish in the autumn and a very long season then I think we could get well over 20.5 million bales of cotton. If they don’t have such a good finish out there, probably 19.5+, so I guess I’d call the crop from 19.5 to 20.5. If everything went beautifully maybe a little bit more than that but that would take everything falling into place.

What impact will that have on the market?

I don’t think it’s going to have a big impact because if you call the crop 107 million bales for the world, a half a million bales one way or the other is not really a very significant thing. I guess what I would say is that a year ago when you came over and interviewed me I was very optimistic about prices, I think I’m almost just as pessimistic today as I was a year ago optimistic. I think the market is going to go down a good bit from here probably. 

The world doesn’t really have too much cotton this year but if we were to plant this much cotton again for the 2005/2006 crop that would really be devastating, so I think the job of the market now is to discourage farmers from planting for the 2005 crop, so if you took March down to about 40cents then that would make December 05 about 45cents and at that level I think we would discourage enough planting that things would probably be in balance, but if we kept December here at around 50cent, which is where we are right now then that makes December 05 at 55cents and that 10c a pound I think could buy a lot of acres around the world. 

A year ago we had good soy bean prices and good corn prices and therefore everybody was having to fight for the acres. This year I think we’re going to see lower corn prices and lower bean prices and so we’re going to have to discourage plantings around, so like I say I wish I could be more optimistic but truthfully I’m not real optimistic about cotton prices in the short run. 

Further Information:  Robert Eveleigh, John Marshall,  Craig McDonald or David Kelly